SA Transcripts • Oct. 28, 2014
Sep. 9, 2014, 9:05 AM
- Telefonica Deutschland (OTC:TELDF) plans to issue new shares to finance part of its €8.6B ($11B) takeover of German rival E-Plus from KPN (OTCPK:KKPNY).
- The company will raise approximately €3.6B in new capital to fund the acquisition, making it the largest German telecom operator with a customer base of over 43M clients.
- Telefonica will issue roughly 1.1B in new shares at €3.24, with full dividend rights dated to Jan. 1, 2014. Shares not allotted or purchased will be assumed by the bank consortium underwriting the issuance.
- Previously: EU clears Telefonica/E-Plus deal
Jul. 2, 2014, 11:07 AM
- As expected, the EU has cleared Telefonica's (TEF -1.1%) $12B acquisition of German rival E-Plus from KPN (KKPNY) following a series of concessions.
- E-Plus and Telefonica's O2 Deutschland (TELDF) unit are promising to rent out up to 30% of the combined company's network capacity, divest some spectrum, and extend existing wholesale and 4G broadband resale deals to any service provider interested in them.
- The EU expects the concessions to spawn the creation of up to 3 new MVNOs, and thus keep competition healthy even as the number of German mobile networks gets cut to 3.
- The clearance is expected to fuel further mobile M&A activity on the continent. EU antitrust chief Joaquin Almunia has argued cutting roaming fees and enabling cross-border services is more important for industry health than having 4 carriers in a market.
Jun. 6, 2014, 10:42 AM
- The EU's antitrust division is "understood to be comfortable" with the concessions offered by Telefonica (TEF +0.3%) to secure approval of its $12B bid to acquire rival German mobile carrier E-Plus from KPN (KKPNY), the WSJ reports.
- The concessions include allocating 30% of Telefonica/E-Plus' German spectrum for use by MVNOs, who have been especially nervous about a deal that lowers the number of carriers in Europe's biggest market to 3.
- The EU recently signed off (following concessions) on the sale of Telefonica's O2 Ireland unit to rival Hutchison Whampoa. Approving the E-Plus deal could pave the way for consolidation in France and other EU markets.
May. 28, 2014, 12:50 PM
- Following concessions, the EU has approved the $1B sale of Telefonica's (TEF -0.1%) O2 Ireland unit to Hutchison Whampoa, which stands to lower the number of Irish mobile networks in operation to 3.
- The EU's approval is contingent on Hutchison selling up to a 30% stake in the merged mobile unit to two MVNOs. Sources tell Reuters Liberty Global (LBTYA +0.2%) is in talks with Hutchison for an Irish MVNO deal.
- Hutchison will also have divest 5 blocks of spectrum, and continue a network-sharing deal with rival eircom.
- The EU's approval could be a sign regulators are willing to approve Telefonica's $12B deal to buy KPN's (KKPNY) E-Plus German unit. Telefonica has already offered concessions to placate worried regulators and MVNOs; a ruling is expected by June 23.
Apr. 11, 2014, 4:43 PM
- A Telefonica (TEF -0.6%) spokesman tells Reuters his company has offered concessions to EU regulators in an attempt to win approval for its €8.1B ($11.9B) acquisition of rival German carrier E-Plus (KKPNY).
- Regulators have been nervous about diminished competition, given the deal will lower the number of German mobile network owners to three: Telefonica, Vodafone, and Deutsche Telekom. MVNOs argue Telefonica should be required to sell some prepaid brands and provide network access to them at cost.
- But as recent remarks from the French government show, there's a growing willingness among continental regulators to support a measure of consolidation, with the hope that merging weaker players will create entities more able/willing to make big network investments.
- The EU plans to rule on Telefonica/E-Plus by June 23. Telefonica still hopes to close the deal by the end of Q2.
Oct. 22, 2013, 9:54 AM
- KPN (KKPNY) are up 1.5% in Amsterdam trading after the telco delivered slightly improving results (excl. its E-Plus unit, which was sold during the quarter)
- Revenue fell 7.6% Y/Y to to €2.08B, compared to a 9.4% drop YTD.
- EBITDA dropped 14% Y/Y to €743M as margin contracted to 35.7% from 38.5%.
- Net profit of €87M plunged 56% Y/Y.
- FCF declined 38% to €63M.
- CEO Eelco Blok: "As expected, market conditions remained challenging in the third quarter. Nevertheless, our businesses in The Netherlands and Belgium are showing positive operational momentum."
- PR, presentations
Oct. 17, 2013, 4:55 AM
- Although America Movil (AMOV, AMX) has withdrawn its €7.2B ($9.7B) bid for KPN (KKPNY.PK) because of a disagreement over price, the deal may not be dead, the CEO of the Dutch telecom group has indicated.
- "I'm not going to say which price we wanted because there is a possibility that we will be sitting around the table again," Eelco Blok said.
- Despite the prospect of renewed talks, KPN shares are -8.6% in Amsterdam.
Oct. 16, 2013, 12:33 PM
- Following weeks of tense negotiations, America Movil (AMX +5.9%) has decided to withdraw its bid for KPN (KKPNY.PK -7.5%). AMX shares have spiked higher on the news.
- Bloomberg reported earlier this month KPN wanted AMX, which already owns ~30% of the Dutch carrier, to raise its buyout offer above $10.7B to account for a tax ruling related to the pending sale of its German unit to Telefonica Deutschland.
- AMX was said to be balking at the demand, arguing its offer already accounted for the tax ruling, and that the Dutch mobile market was seeing intensifying competition.
Oct. 1, 2013, 4:10 PM
- Sources tell Bloomberg KPN (KKPNY.PK) wants America Movil (AMX +2.9%) to raise its buyout offer to €2.65/share (€7.9B/$10.7B) from a current €2.40/share (€7.2B/$9.7B), so as to take into account the favorable tax ruling it recently got on the pending sale of its German unit to Telefonica Deutschland.
- America Movil, however, is said to be holding firm, arguing its current offer already accounts for the tax ruling, and that cable provider Ziggo's recent entrance into the Dutch mobile market is a sign of deteriorating market conditions.
- The filing of America Movil's formal offer for KPN, originally expected in September, is now due this month.
- More on America Movil/KPN
Sep. 16, 2013, 4:15 AM
- KPN (KKPNY.PK) will be able to cut its taxable income in Holland by €3.7B ($4.9B) over the coming years, beginning in 2014, due to the losses it's suffering on the the €8.55B ($11.4B) sale of German unit E-Plus to Telefonica Deutschland.
- The Dutch telecom carrier, which is the subject of a €7.2B takeover bid from Mexico's America Movil (AMX, AMOV), bought E-Plus for almost €19B.
Sep. 12, 2013, 2:27 AM
- Has Carlos Slim's bluff been called? Slim's America Movil (AMX, AMOV), which owns 29.8% in KPN (KKPNY.PK), is in talks over a full takeover of the Dutch telecom carrier, the latter says.
- America Movil had offered €7.2B ($9.58B) to acquire the shares in KPN it doesn't own but threatened to drop the bid in response to the KPN foundation adopting a poison pill.
- KPN shares rose yesterday on speculation that Slim would increase his proposal even though America Movil has said there is "no way" it would do so. (PR)
Sep. 11, 2013, 2:58 PM
- Shares of KPN (KKPNY.PK +5.6%) trade up on speculation that Carlos Slim may up his €2.70/share offer for the Dutch telco.
- Slim threatened to drop America Movil's bid in response to the KPN foundation's poison pill adoption. However, broader strategic considerations such as the value of Movil's current KPN stake and the necessity of diversification due to regulatory pressures in Mexico may cause Slim to flip flop.
- Earlier, Moody's assigned an A2 rating to $750M in 2016 floating-rate America Movil notes intended to finance part of the KPN tender.
Sep. 9, 2013, 11:40 AM
- Royal KPN (KKPNY.PK) CFO Eric Hageman resigns. The company stated that Hageman stepped down due to personal circumstances unrelated to America Movil's contested takeover bid for the Dutch telco.
- Kempen analyst Sander van Oort: "The timing of the resignation isn't great ... He plays a crucial role in the [America Movil] negotiations and how to make this a successful transaction ... there might also be more internal focus now."
Aug. 30, 2013, 3:45 AM
- America Movil (AMX, AMOV) is prepared to withdraw its €7.2B takeover offer for KPN (KKPNF.PK) after an independent foundation created to protect the interests of shareholders and other stakeholders moved to block the deal.
- The foundation exercised an option to acquire almost 50% of KPN's voting stock, saying that those stakeholder interests were at risk because America Movil didn't consult with the Dutch telecom carrier before announcing its bid. However, the foundation is open to America Movil addressing its concerns.
- KPN shares are -5.2% in Amsterdam.
Aug. 26, 2013, 2:52 AM
- America Movil (AMX, AMOV), which owns almost 30% in KPN (KKPNF.PK) and is looking to acquire the rest, will support the latter's sale of its German mobile unit E-Plus to Telefonica Deutschland (TEF) after the Spanish-owned telecom operator improved the deal terms.
- KPN will now receive 20.5% in Telefonica Deutschland rather than 17.6%, as originally planned, raising the value of the transaction to €8.55B ($11.4B) from €8.1B.
- KPN shareholders are due to vote on the sale on October 2.
Aug. 9, 2013, 2:05 AM
- America Movil (AMX), which owns 29.8% of KPN (KKPNF.PK), is launching a bid to acquire the rest of the Dutch carrier for €2.40 a share, or a 20% premium to yesterday's closing price.
- The offer values the 70.2% stake that America Movil doesn't own at €7.2B.
- The proposal comes after America Movil last month terminated an agreement to keep its stake under 30% after KPN agreed to sell its German unit E-Plus to Telefonica (TEF) for €8.1B. The Mexican company has yet to decide whether to support the transaction.
- America Movil's proposal is conditional on obtaining a stake of over 50%.
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