America Movil Signs Deal to Take Control of Telekom Austria
Published on: 24th Apr 2014
Note -- this news article is more than a year old.
Mexico's America Movil is launching a full takeover bid for the Telekom Austria Group, having secured an agreement with the Austrian government's own holding company, IAG.
America Movil and ÖIAG have initially signed a shareholders agreement to effectively pool their stakes in the telecoms company into a single syndicate.
America Movil already owns 26.4% of the company, while the government owns 28.4% of the telco.
Now that the agreement, which had been expected has been signed, the two companies jointly control more than 30% of the shares and are required by Austrian stock market rules to launch a takeover bid for the company.
Subject to the closing of the takeover bid, the two shareholders will also pump an additional EUR1 billion into the company to help fund network upgrades.
America Movil will take over management of the company, although it is expected that the Austrian government would, through ÖIAG remain the larger of the two shareholders. ÖIAG also has the right to nominate the CEO and Chairman of the company.
The move is indirectly, a nationalisation of the company by the government, with a major stake held by a foreign investor.
Telekom Austria currently operates in Austria, Belarus, Bulgaria, Croatia, Serbia, Macedonia, Liechtenstein and Slovenia. As of December 31, 2013, it had approximately 2.6 million fixed line subscribers, 20.1 million wireless subscribers and revenues of EUR 4.18 billion.