MADRID (Reuters) -MasMovil announced on Sunday a friendly takeover bid for rival Spanish telecoms firm Euskaltel worth nearly 2 billion euros ($2.4 billion), in a move set to shake up Spain’s competitive telecoms market.
MasMovil said it had already secured the agreement of shareholders who hold 52.32% of Euskaltel’s capital. It is offering 11.17 euros per share in cash, which is a 16.48% premium compared with Friday’s closing price.
“MasMovil and Euskaltel together form a solid and complementary industrial project,” MasMovil said in a statement, adding that the takeover would allow it to “reinforce and boost its growth and continue transforming the telecommunications sector in Spain.”
MasMovil said its offer was conditional on achieving the acceptance of at least 75% plus one share of the capital and obtaining all appropriate competition and regulatory authorisations.
MasMovil said it would maintain the Euskaltel, R, Telecable and Virgin brands. It also said, without giving details, that it would maintain employment at those companies.
In documents sent to Spain’s CNMV stock market supervisor, MasMovil said it approached the board of Euskaltel on March 15 with an offer to buy the company. The board of directors of Euskaltel “agreed on 17 March 2021 to consider the offer friendly and attractive,” the document said.
On Sunday, the document said, MasMovil and Euskaltel entered into an agreement in which they formalised the arrangements reached in relation to the takeover bid.
Euskaltel declined to comment.
MasMovil said buying Euskaltel would reinforce its position as Spain’s fourth-largest telecoms company. European telecoms operators have struggled to boost profit growth in a crowded market, and speculation over possible consolidation in Spain had long been rife.
MasMovil itself was taken over last year by U.S.-based funds KKR & Co Inc, Providence and Cinven, which delisted it from the Madrid stock exchange.
Reporting by Jessica Jones, Ingrid Melander and Jesus Aguado; Writing by Ingrid Melander; Editing by Emelia Sithole-Matarise and Peter Cooney