Mexican billionaire Carlos Slim struck an 11th-hour deal with the Austrian government on Wednesday to pool their stakes in Telekom Austria, paving the way for Slim to take control of the Austrian phone company.
Slim’s telecoms giant, America Movil (AMXL.MX), agreed to vote in favor of a 1 billion euro capital increase for Telekom Austria (TELA.VI) and to pay 7.15 euros a share for the company’s outstanding shares, in a deal that will see it combine its stake with Austrian state holding company OIAG.
America Movil already holds 26.4 percent of Telekom Austria; OIAG holds 28.4 percent.
Earlier on Wednesday, labor representatives unhappy with the proposal boycotted a meeting designed to rubber-stamp the co-ownership deal.
Signing the agreement is a coup for America Movil, which is facing increasing regulation and competition in Latin America and has faced various hiccups in attempts to expand in Europe.
The deal could finally allow Slim to begin consolidating the fruits of his European adventure, begun in 2012 with investments of more than $1 billion in Telekom Austria and $3.4 billion in Dutch group KPN (KPN.AS).
Wednesday’s agreement envisages pooling the stake held by the OIAG with the stake held by America Movil (AMXL.MX) in a syndicate in which both parties would have to vote in unison on major issues, triggering a joint takeover offer.
Telekom Austria shares closed down 3.19 percent at 6.65 euros before the agreement, after slumping almost 5 percent earlier as prospects of an imminent offer for the rest of the company appeared to fade.
America Movil shares closed up 0.47 percent at 12.90 pesos.
(Additional reporting by Dave Graham in Mexico City and Derek Brooks; Editing by David Goodman and Leslie Adler)