This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

The Deal: KPN Foundation Plans to Block Movil Offer

NEW YORK ( The Deal) -- A foundation established to defend the interests of Royal KPN NV, on Friday, Aug. 30, chastised would-be suitor América Móvil (AMX - Get Report) for launching a ¿7.2 billion ($9.5 billion) hostile offer for the outstanding shares, saying it would block the deal but also calling on the Mexican phone company to enter negotiations.

The foundation said it forced KPN to issue it new shares equivalent to the target's existing share capital minus one share, allowing it to vote down the unwanted approach.

"Based on all the information obtained from stakeholders, the foundation has concluded that the situation that has now arisen in relation to KPN constitutes a threat," the foundation said.

Investors clearly feared a demise of the deal, pushing KPN shares down 5.4%, or ¿0.124, to ¿2.166 in early Amsterdam trading.

The foundation is formally known as Stichting Preferente Aandelen B KPN, or Foundation Preference Shares B KPN. It said it was safeguarding not only the company and its employees, but also "Dutch society more generally."

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 of Spain for ¿8.1 billion.

The timing seemed to show América Móvil was disappointed with the planned E-Plus sale. However, the Mexican phone company this week agreed to support the deal in exchange for a sweetened bid, which is now worth ¿8.55 billion.

América Móvil said Friday it would be willing to withdraw the approach if it couldn't convince the foundation of its good intentions. The Mexican phone company also parried the foundation's criticisms, saying it had not only been in talks with KPN brass, but had actively helped KPN in the year and a half since it became the Dutch company's biggest shareholder.

"As a long-term investor we believe we can help KPN focus more on its infrastructure investments for the benefit of its customers, its employees and its shareholders. We believe we can help make it into a better company," América Móvil said.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AMX $14.16 0.00%
AAPL $93.74 0.00%
FB $117.58 0.00%
GOOG $693.01 0.00%
TSLA $240.76 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs