América Móvil backs KPN rights issue
América Móvil, KPN’s largest shareholder, has agreed to support the Dutch telco’s bid to raise €4 billion in equity capital.
The Latam telecoms group said it will approve the bid subject to the appointment of two individuals it designates to KPN’s supervisory board, among other conditions.
These will be put before a general meeting of shareholders on April 10.
América Móvil also said it had reached an indefinite agreement with KPN not to take its ownership past the 30% threshold, which would force a buyout offer under Dutch law.
The fund raising exercise will consist of a €3 billion rights issue and a €4 billion issue of hybrid capital instruments, expected to receive partial equity recognition.
KPN plans to use the proceeds to reduce its debt and continue investment in its operations.
América Móvil said in a statement to the Mexican stock exchange that it was participating in the offer to strengthen KPN’s capital base, maintain KPN’s investment rating and allowing the company to pursue strategic initiatives.
Carlos Slim, the world’s richest man and owner of the América Móvil group, has incurred large paper losses since investing €3 billion in the stake last year, at €3.228 a share.