Spain's Euskaltel board agrees to negotiate takeover bid from MasMovil

MADRID (Reuters) – Spanish telecom operator Euskaltel said on Monday its board had agreed to collaborate with MasMovil after its larger rival launched a takeover bid.

Euskaltel said it had accepted on Sunday to provide “reasonably needed support” to MasMovil to carry out the takeover and prepare documents to secure approval from regulators.

Euskaltel’s board members would set out their position regarding the bid, the company said in a statement on Monday.

MasMovil, which is own by three buyout funds led by KKR announced on Sunday a friendly takeover bid for rival Euskaltel, which is worth nearly 2 billion euros ($2.4 billion).

MasMovil said it had already secured the agreement of shareholders, who hold 52.32% of Euskaltel’s capital. It is offering 11.17 euros per share in cash, which is a 16.48% premium compared with Friday’s closing price.

The move would shake up the highly competitive Spanish market by reducing the number of players.

MasMovil said its offer was conditional on achieving the acceptance of at least 75% plus one share of the capital and obtaining all appropriate competition and regulatory authorisations.

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