A year after the Saudi STC confirmed its intention to take over 9.97% of Telefónica, the Government has authorized the operationaccording to Europa Press. Of course, with a new situation that implies that the company would no longer be its largest shareholder once the purchase of the securities it wants has been formalized. Now it is the Government of Spain.
In September 2023, STC acquired 4.9% of the operator’s share capital through direct shares. It also raised another 5% through various financial instruments. It invested 2.1 billion euros in them, but the operation needed authorization to be completed.
According to the laws on investments by foreign entities, the Government of Spain has to authorize operations that involve a company from outside the European Union holding more than 5% of the share capital of a Spanish company considered a strategic and security-related company. national, like Telefónica. Therefore, the purchase of securities was paralyzed, waiting for the authorization that has finally arrived.
Of course, in the meantime there have been several movements in Telefónica’s shareholding that have significantly changed the situation. At the end of May, the SEPI (State Society of Industrial Participations), an organization that depends on the Ministry of Finance, owned 10% of Telefónica shares. He became the operator’s largest shareholder five months after receiving the mandate to do so. This culminated an operation developed by the Government to prevent STC from having more shares in the operator than the rest of the shareholders.
Furthermore, STC will not be Telefónica’s second largest shareholder either, since Criteria Caixa currently has 9.99%, and may even take 10.01%. The Government would also be considering increasing its participation in the operator up to 12%, to request the entry of a second director on its board of directors.
The Minister of Economy, Commerce and Business; Carlos Bodywhich in addition to confirming the government’s approval of the operation proposed by STC, has highlighted that “It is important to note that measures or conditions that have been accepted by the Saudi company have been put on the table, and have been established, to effectively guarantee that this operation is carried out in a way that ensures that strategic element, that ensure the operational autonomy of Telefónica, that, as I said, national interests are protected and that this critical infrastructure is protected«.
Body has also commented, on the possibility of STC requesting that there be a director representing the company on the Board of Telefónica, that this decision corresponds to the company. The minister, in relation to the assessment of increasing the government’s participation in the operator by increasing the total shares it owns by 2%, commented that it is still early to assess “an additional position«, but he has not ruled out that they are going to do so.
