Portugal Telecom shareholders rejected proposed changes to the company's statutes, effectively blocking Portuguese conglomerate Sonae's 11.8 billion euros ($15.5 billion) takeover bid for its bigger rival, an Associated Press report said.
The Associated Press report said shareholders held a general assembly on whether to scrap a statute stipulating that no single shareholder may hold more than 10% of the former state monopoly's voting rights.
The change was a requirement for the takeover, led by Sonae's telecommunications division Sonaecom, since the bid was conditional on acquiring 50.01% of PT, the report said.
Almost 47% of shareholders at the meeting voted against the proposal, which required at least two-thirds in favor to pass, the report added.
PT's board said the bid, which brought one of Europe's biggest takeover battles, was hostile and undervalued the company, the report said.
Sonaecom launched its bid last year. It cleared its last regulatory hurdle in January.
Last month, amid signs shareholders were reluctant to accept its offer, Sonaecom raised its bid to 10.5 euros ($13.8) per share from 9.5 euros ($12.5).
Portugal's competition authority had said that if the bid was successful, SonaeCom would have to offload either the inherited fixed-line or cable networks, the report further said.