Saudi Arabia’s stc Group has acquired a 9.9% stake in Telefónica for €2.1 billion and is now the largest shareholder in the Spanish telco.
However, it says it has no intention of securing control or a majority stake, rather seeing the move as “a compelling investment opportunity”.
Commenting on the transaction, Mohammed K. A. Al Faisal, chairman of stc Group, said, “Telefónica and stc Group share many similarities, with a vision to use technology to connect people and a strategy to drive growth. This long-term, significant investment by stc Group is a continuation of our growth strategy, as we invest in vital technology and digital infrastructure sectors across promising markets globally”.
Olayan Alwetaid, CEO of stc Group, added: “Our investment in Telefónica demonstrates our confidence in Telefónica’s leadership, its strategy and its ability to create value. As long-term, supportive shareholders, we are committed to strengthening our partnership.
“We do not intend to acquire control or a majority stake but rather we see this as a compelling investment opportunity to use our strong balance sheet whilst maintaining our dividend policy”.
Stc Group says that its growth strategy has resulted in a number of investments in the Information, Communication and Technology sector inside Saudi Arabia and globally, the most recent being the acquisition by Tawal – a subsidiary of stc Group – of United Group’s telecommunications tower assets in Bulgaria, Croatia and Slovenia.
Broadband TV News notes that any foreign investment above 10% in Telefónica would require the approval of Spain’s Council of Ministers.