Billionaire Carlos Slim may buy Dutch telco KPN

Mexican billionaire Carlos Slim.
Susana Gonzalez | Bloomberg | Getty Images
Mexican billionaire Carlos Slim.

Dutch telecom group KPN's main shareholder America Movil has ended an agreement to limit its holding to below 30 percent, a sign it may bid for the whole company.

Mexican billionaire Carlos Slim's company, which owns just under 30 percent of KPN, was entitled to end the "standstill" agreement after Telefonica's 8.1 billion euro ($10.7 billion) bid for KPN's German mobile arm E-Plus, KPN said on Monday.

America Movil said on Friday it was still deciding whether to back KPN's proposed sale of E-Plus, regarded as its crown jewel. Germany is Europe's biggest mobile market.

The Mexican company, which has lost about 2 billion euros on its KPN investment since last year, declined to comment on Monday beyond KPN's brief statement except to say that it would keep its two seats on KPN's board.

A KPN spokesman said America Movil had not communicated its intentions, such as whether it intended to increase it stake to 30 percent, a level that would trigger a mandatory takeover offer for the whole group.

"They can now increase their stake but I don't see it happening in the short term. I think they'll wait and see how it ends with E-Plus.It's possible that they are interested in the Dutch operations of KPN, and that they want to take it over in the medium term," said Christopher Ho, analyst at AFS Brokers.

Ho said he did not rule out America Movil selling its stake in KPN either but he did not expect that to happen soon. Selling the stake was not a restriction in the now-terminated shareholders' agreement between the two.

The two companies agreed their cooperation deal in February, at the time of KPN's 4 billion euro capital increase, including a rights issue to which America Movil subscribed.

In theory this agreement was indefinite, with a two-month notice period. KPN said on Monday America Movil was entitled to break the deal without notice after the E-Plus offer.