The Deal: KPN Confirms Talks With America Movil
In its first confirmation of discussions, KPN, of Amsterdam, said the talks were part of its board's fiduciary responsibility to investors. But it warned the negotiations may prove fruitless.
"In this process we are carefully considering and weighing the interests of our shareholders, employees, customers and other stakeholders on financial and non-financial matters including safeguarding the vital role of KPN in Dutch society," KPN CEO Eelco Blok and supervisory board chairman Jos Streppel said in a statement.
The talks come after a KPN foundation that functions as a poison pill said it would veto the deal, in part because it claimed América Móvil had not sought out talks. The Mexican phone company said Thursday that it "continues to be committed to its previously announced plans" for the 2.40 euro-per-share offer and described its talks with KPN as constructive.
But it reiterated that it may walk away because of the foundation's intervention.
The foundation is formally known as Stichting Preferente Aandelen B KPN, or Foundation Preference Shares B KPN. It has already forced KPN to issue it new shares equivalent to KPN's share capital minus one share.
It said it was safeguarding not only the company and its employees, but also "Dutch society more generally."
KPN shares by early afternoon in Amsterdam were up 0.04 euros at just under 22.28 euros.
América Móvil is controlled by billionaire Carlos Slim and this summer launched an unsolicited offer for KPN after last year buying a 29.8% stake as part of a European push. The bid came just days after KPN agreed to sell its German E-Plus unit to América Móvil nemesis Telefónica SA, of Spain, for 8.1 billion euros.
América Móvil was reportedly disappointed with the planned E-Plus sale but eventually agreed to vote its KPN shares in favor of the sale after Telefónica increased its offer to 8.55 billion euros.
KPN has yet to deliver its verdict on the offer.
-- Written by Andrew Bulkeley in New York