The operation was completed in five months and the Government has left the door open to request a second director in the company.
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The State Company of Industrial Participations (SEPI), an entity dependent on the Ministry of Finance, has reached 10% of the share capital of Telefónica and has completed the mandate of the Government transferred at the end of last year, as reported in a statement.
Specifically, SEPI has acquired a total of 567,016,155 shares with an average price of 4.0295 euros per share, so the amount of the operation amounts to almost 2,285 million euros, although this share package must be add 541 titles that SEPI already had in its portfolio and that brings the total number to 567,016,696.
“The operation has been carried out minimizing the impact on the price and complying with the communications of significant holdings established in the regulations of the markets where it operates,” the public entity has detailed.
If we take into account Telefónica’s price at the close of trading this Monday, which ended at 4.186 euros, the State’s shareholding in the company has a market value of about 2,373.5 million euros, that is, about 89 million euros more than the amount disbursed.
The Government’s mandate to SEPI occurred on December 19, 2023, so the operation to acquire 10% of Telefónica by the State has been carried out in five months.
Regarding the advance of SEPI’s position in Telefónica’s share capital in recent months, on March 25, a participation of 3.044% emerged; On April 15, it increased it to 5.034%; On April 26, it was announced that it had increased it to 6.169%; On May 8, the increase in its position to 7.079% was reported; On May 14 it reached 8.53% and two days later, on May 16, it increased it to 9.038%.
It should be remembered that the Government’s mandate to SEPI to acquire up to 10% of Telefónica was a movement that occurred in reaction to the surprise landing of the Saudi telecom company STC in the company chaired by José María Álvarez-Pallete on September 5.
Specifically, STC acquired 9.9% of Telefónica’s share capital – 4.9% in direct shares and 5% in financial derivatives – in an operation valued at 2.1 billion euros, that is, around 185 million euros less than the amount disbursed by the Executive.
POSSIBILITY OF HAVING TWO DIRECTORS
The board of directors of Telefónica agreed on May 8, unanimously, to accept the “voluntary resignation” of Carmen García de Andrés from her position as director and appointed by co-option as director Carlos Ocaña Orbis representing the SEPI.
Just one day after Ocaña’s appointment was agreed, the Minister for Digital Transformation and Public Function, José Luis Escrivá, left the door open to the possibility that the Government could appoint a second advisor to represent the SEPI when the deadline was met. objective of acquiring 10% of the capital of the teleco.
Likewise, last week Escrivá was asked at an event about the possibility of the State continuing to acquire shares in the telecom company once it had reached 10%, although the minister assured that “the Government has given instructions to the SEPI as to how far it wants arrive on Telefónica”.
For its part, the public entity has highlighted this Monday that SEPI’s participation in the capital of Telefónica has a “tendency” and seeks to provide “greater shareholder stability” to the company to achieve its objectives, while at the same time contributes to the “protection of its strategic capabilities.”
Furthermore, SEPI has stressed that “Telefónica is one of the main companies in the country, a leader in the telecommunications sector and key in other strategic areas.”
“The company is decisive due to its industrial capabilities and areas of knowledge, since it develops activities relevant to the economy and the productive fabric, including those related to security and defense,” he added.
AUTHORIZATION TO STC
Beyond the fact that the Government has left the door open to the possibility of requesting another director at Telefónica, it is still to be determined whether STC will request a seat on the highest decision-making body of the Spanish company.
According to current regulations on foreign investments and because Telefónica is considered a strategic company related to national security, the Government must give its approval for a non-EU company to have more than 5% of the share capital in a Spanish company. of this type.
Thus, STC must send the Executive its intentions in the company and detail whether its objectives include, among other issues, joining the company’s board of directors or not. However, it is unknown if STC has sent that document, although the Government has stated on several occasions that there is no record of this.
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