América Móvil has backed away from its $10 billion offer to acquire a controlling interest in Dutch wireless operator KPN even though the deal had gained approval from Dutch regulators. That deal had originally been announced in August and called for América Móvil intention to make a voluntary cash tender offer for the outstanding ordinary shares of KPN at a price of $3.20 per share, which was a 35.4% premium over the average closing price of KPN’s ordinary shares on Euronext Amsterdam for the previous 30 trading days.
In a statement, América Móvil noted that the way KPN’s ownership is currently structured it would not be able to gain a controlling interest in the operations and thus has removed the offer from the table. América Móvil noted last month that it was looking at removing the offer to acquire KPN following moves by KPN’s supervisory board to block such an attempt.
KPN’s supervisory board allowed the granting of an option to the “Stitching Preference Shares B KPN,” also known as the “Foundation” to purchase shares in KPN that would prevent América Móvil from gaining controlling interest.
“[América Móvil] now concludes, in view of the Foundation’s position and the discussions with KPN, that its aim to acquire more than 50% of the voting rights in KPN … will not be met by making the intended offer,” América Móvil noted. “This aim is essential to achieve the rationale and objectives of the intended offer. The Foundation, having exercised the option granted to it by KPN to purchase Class B preference shares in the capital of KPN, obstructs the fulfillment of this aim, to the detriment of KPN shareholders who would have intended to participate in the intended offer.”
América Móvil, which controls domestic wireless operator Tracfone Wireless, was looking at the KPN bid as a way to extend its reach into the European market and further bolster its position against rival Telefonica.
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