KPN sells German mobile operator to Telefonica
The deal creates the biggest operator on the German market, as measured by subscribers, and ends a long effort by KPN to raise cash as it seeks to build up defences against a hostile takeover effort by Mexico's America Movil.
Following approval from the authorities, the sale should allow for €5.5bn in efficiencies on the German mobile communications market, KPN said in a statement.
"KPN will use most of this money to increase its financial flexibility and intends to resume payments of dividends to stockholders for 2014," the company said.
KPN had been urgently looking to sell its German business as a way to fend off the takeover effort by America Movil, but had struggled to do so given a poor investment climate.
The Mexican giant, owned by tycoon Carlos Slim, owns 27% of KPN ever since it launched a hostile bid in 2012. America Movil approved the sell-off in exchange for two seats on the KPN board.
The announcement comes as KPN announced a 68% fall in net profit for the first half of 2013 to €108m. Sales in the period were off 8.1% from the figure a year earlier to €2.93bn, the company said.
"Conditions remained challenging in the first half of 2013, however we have further strengthened our market positions," chief executive Eelco Blok said.
Source: AFP, via I-Net Bridge
Source: I-Net Bridge
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