HomeNewsKPN buys back €20.5m worth of shares in bid to thwart hostile...

    KPN buys back €20.5m worth of shares in bid to thwart hostile takeover


    Latest stock purchase is part of €200 million share reclaim strategy – protecting KPN is a national security issue

    Dutch flagship mobile operator Royal KPN NV (KPN) has unveiled details of the latest phase of its share consolidation in defence against a possible hostile takeover.   

    In a statement on its web site KPN announced it has repurchased 7,523,256 KPN ordinary shares in the period from 23 to 27 August 2021. The shares were repurchased at an average price of € 2.73 per share for a total consideration of €20.5m. “These repurchases were made as part of the € 200m share buyback started on 23 August 2021 with the purpose to reduce the capital of KPN,” it said.

    The operator has been the subject of considerable takeover interest over the years but so far they have foundered.

    In May KPN confirmed that it had rejected an unsolicited high level approach by Swedish investment company EQT and Stonepeak for a takeover of KPN. The EQT/Stonepeak proposition did not include an offer price. KPN also recently rejected a separate unsolicited approach for a takeover of KPN made by KKR. The Boards of KPN concluded that both approaches fail to provide tangible and material added value over KPN’s new growth strategy.

    In October 2020 it was reported that KPN’s revenues had fallen for a decade and its market valuation had plunged to around €9.4 billion.

    Buy back better

    KPN’s independent foundation, Stichting Preferente Aandelen B KPN, has the power to temporarily change the structure of the company’s voting shareholding to prevent a hostile takeover, such as by KPN’s largest shareholder, America Movil, in 2013.

    In 2020 the Netherlands passed a law enabling the government to block any takeover of communications on the grounds of national security, following a failed takeover involving  Brookfield Asset Management in 2019.

    KPN sold its international network unit for €50 million in 2019 as part of a strategy to rationalise the business and cut costs.