America Movil plans acquisition of Royal KPN NV for € 7.2 bn

Carlos Slim's America Movil SAB plans to make a € 7.2 billion bid for Dutch telecom operator Royal KPN NV, a move that might clash with a bigger deal by the Dutch carrier to sell its German business to Spain's biggest carrier Telefonica SA.

America Movil expects to bid €2.40 a share in cash for the 70 per cent in KPN that it does not own, according to the Mexico City-based company.

KPN was up 16 per cent to €2.32 at the close of trading in Amsterdam, while America Movil fell as much as 7.3 per cent in Mexico City. The offer, would be made official next month, subject to America Movil winning a stake of over 50 per cent.

Slim, who is looking to play a bigger role in Europe as the region's telecommunications market consolidates, is committing additional funds into what has been a loss-making investment so far.

According to commentators, the Mexican billionaire now had more freedom to use Royal KPN NV to expand in Europe as the telecommunications market in the region consolidated.

The twist comes weeks after KPN agreed to divest its E-Plus unit to Spain's Telefonica -- Slim's biggest rival in Latin America for the creation of Germany's largest wireless carrier by customers. According to America Movil it had not yet decided on the €8.1 billion-euro transaction. The sale would require the approval of shareholders of KPN, which today said it  planned to convene a meeting ''in the coming weeks.''

According to analysts, the prospective deal was the culmination of over a year of planning by Slim, and might trigger a flurry of deal activity as rivals positioned themselves ahead of a major revamping of Europe's telecommunications sector.

The KPN acquisition would come as América Móvil's largest takeover bid ever outside Latin America, and follows a deal last year to up its stake in Telekom Austria, another European operator, to 23 per cent.

Other operators, including Vodafone as also John C Malone's Liberty Global, have also been picking up telecommunications and cable assets across Europe.

KPN said in a brief statement, that it had been informed about América Móvil's offer, adding that it would examine the offer before recommending a course of action to shareholders. It added it could still continue to pursue the potential sale of E-Plus to Telefónica.