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Másmóvil falling into private hands

Másmóvil, Spain's fast-growing and fourth-largest operator, looks on course for a delisting.

According to Expansión, a Spanish business newspaper, a takeover bid from Lorca Telecom – a consortium comprising three private equity firms – has won approval from Másmóvil shareholders representing around 86% of the operator's capital.

Should the bid – which was put together by Cinven, KKR and Providence Equity Partners – win 100% approval, Másmóvil will carry a €3 billion (US$3.6 billion) price tag.

Lorca is aiming to wrap up a full takeover by the end of October. A Másmóvil delisting from the IBEX 35 bourse is slated for early November.

Under Spanish takeover law, Lorca will still need to call a shareholder meeting to approve the firm's delisting. This seems a formality, however, given the way things appear to be panning out.

Assuming the bid is successful, Cinven, KKR and Providence Equity Partners will each own a third of the operator.

Not a smooth ride
The majority of Másmóvil shareholders have apparently not been swayed by the arguments of Polygon Global Partners, an activist minority investor in the operator, which was vocal in its opposition to the terms and conditions of the Lorca proposal.

Nicolas Dautigny at Polygon Global Partners, in an open letter to Eduardo Díez-Hochleitner Rodríguez, Másmóvil's chairman, went so far as to imply that CEO Meinrad Spenger was putting his own interests ahead of shareholders.

"It is essential not to forget," said Dautigny, "that the company itself, whose management team is led at the highest level by the CEO, has entered into an agreement [with Lorca] in relation to the bid which, among other issues, addresses remuneration matters that affect him and his team personally and directly."

Bucking trends
A stellar operational performance has helped boost the value of Másmóvil stock this year, despite a fall in the sector benchmark index.

During the first half of 2020, broadband and mobile postpaid subscribers were up, year-on-year, by 39% and 17% respectively.

According to Fitch Ratings, in a recent research note, Másmóvil "consistently acquires the majority of net customer additions in fixed broadband and postpaid mobile accesses."

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— Ken Wieland, contributing editor, special to Light Reading

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