América Móvil launched an offer for shares in Telekom Austria that are not already owned by the Mexican group or its partner, Austrian state holding company ÖIAG, and said it expects the transaction to cost it around €1.4 billion ($1.9 billion).
In an offer document published on Thursday, the Carlos Slim-owned operator said it is offering €7.15 a share for the rest of the Austrian telecoms company's stock via its Dutch holding company Carso Telecom. The offer will remain open for eight weeks, expiring on July 10 at 17:00 Central European time.
América Móvil has already spent about $1 billion (€729 million) on building up its stake in Telekom Austria since 2012, Reuters noted.
As things stand, Carso Telecom owns about 25 per cent of Telekom Austria and ÖIAG holds a 28.4 per cent share. América Móvil owns a further 1.79 per cent directly. Around 44.6 per cent is in free float.
The Mexican group also said it and ÖIAG have agreed to subscribe to a capital increase of €1 billion that will take place either in the second half of 2014 or the first half of 2015. ÖIAG is to participate in order to maintain at least 25 per cent plus one share in Telekom Austria.
In April América Móvil finally reached an accord with the Austrian state to increase its control over Telekom Austria and agreed with ÖIAG to pool their respective stakes in the operator under a 10-year accord. The agreement provides Carso Telecom with the industrial leadership and control of Telekom Austria, while ÖIAG retains certain veto rights as a core shareholder.
While the general reaction at the time was that the Carlos Slim-owned group plans to use the Austrian incumbent as a starting point for his European growth ambitions, there were lingering doubts over the future strategy.
Telekom Austria does have plenty of assets elsewhere, which was part of the attraction for the Mexican group: it owns a mix of fixed and mobile operations in Belarus, Bulgaria, Croatia, Serbia, Macedonia, Liechtenstein and Slovenia. As of December 31, 2013, it had about 2.6 million fixed-line subscribers, 20.1 million wireless subscribers and revenues of €4.1 billion.
For more:
- see this Reuters article
- the press release and offer documents are available on América Móvil's site but are not for global distribution.
Related Articles:
Telekom Austria faces uncertain future under Slim
Telekom Austria CFO quits as Slim deal looms
ÖIAG paves way for América Móvil to gain influence over Telekom Austria
Telekom Austria works council calls for clarity over Slim
América Móvil says it's not in Europe to make a fast buck: report