America Movil SAB (AMXL) is discussing an agreement to combine its Telekom Austria AG (TKA) shares with the Austrian government to form a syndicate, a move that would lead to a bid for full control of the European phone carrier.
America Movil has had discussions with other shareholders, including government holding company OIAG, to explore mutual cooperation, the Mexico City-based company said yesterday in a statement. The company said formal talks could be started about a shareholders’ syndicate agreement with OIAG.
The Latin American phone carrier, controlled by billionaire Carlos Slim, is betting on a recovery in Europe as growth slows in Mexico and Brazil. A pact with the Austrian government would let America Movil take a friendlier takeover approach than it did last year, when opposition from Royal KPN NV executives led it to drop a bid for the Dutch carrier’s shares.
Under Austrian law, a syndicate between America Movil and OIAG would trigger a mandatory offer for all outstanding Telekom Austria shares, giving America Movil a chance to increase its 26.8 percent stake. OIAG holds 28.4 percent of the company, according to data compiled by Bloomberg.
The mandatory offer would have to match the average price of Telekom Austria shares over the past six months, which was 6.09 euros before today, according to data compiled by Bloomberg. America Movil fell 1.3 percent to 13.16 pesos yesterday in Mexico City. Telekom Austria rose 1.9 percent at 10:46 a.m. today in Vienna.
Telekom Austria Chief Executive Officer Hannes Ametsreiter said this week that he wasn’t aware of talks between the Austrian government and America Movil over a potential shareholder agreement.
“One of the biggest global operators can be a consolidating force in Europe,” Ametsreiter said over dinner at the Mobile World Congress in Barcelona. “If not them, who else?”
America Movil said it doesn’t have any current agreement with other shareholders. Peter Schiefer, a Telekom Austria spokesman, declined to comment.
“There are no concrete negotiations between OIAG and America Movil about a shareholder agreement,” Bernhard Nagiller, an OIAG spokesman, said in a telephone interview. There are only talks about possible strategic options.’’
America Movil’s withdrawal from the KPN bid last year fueled speculation the Mexican company would increase its stake in Telekom Austria to boost its European holdings.
By combining with America Movil in a syndicate, the government could ensure a continuing say in Telekom Austria even if America Movil holds a bigger stake. Letting Slim hold more of the company than OIAG is of “secondary” concern as long as Austria has a blocking minority of 25 percent, Rudolf Kemler, head of the nation’s state holding company and Telekom Austria’s chairman, said last month.
A pact between Austria and America Movil could be modeled on a similar agreement that the state holding company has with International Petroleum Investment Co., which keeps the two shareholders from voting against each other on important decisions at Austrian energy company OMV AG.
Austria’s government is open to a syndicate with America Movil, Economy Minister Reinhold Mitterlehner said today. The prospect of forming a shareholder pact is “definitely interesting,” Mitterlehner said before a government meeting in Vienna. Finance Minister Michael Spindelegger said he wants Telekom Austria to have a “growth strategy,” according to the Austrian Press Agency.
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