José María Álvarez-Pallete, president of Telefónica, and Ángel Vilá, CEO, held a meeting in Riyadh with the leadership of Saudi Telecom Company (STC) to learn about the plans of the Saudi Arabian telecom company after announcing its entry into the capital of the Spanish with up to 9.9%.
The content of the meeting remained private and no details were revealed. Discretion regarding this operation is the position that Telefónica intends to adopt, at least until the Government makes a decision on the matter.
Last Tuesday, after STC announced that it had taken 4.9% of Telefónica directly and that it would carry out, if it obtains authorization from the Spanish Government, the conversion of derivatives on another 5% to reach 9.9%, the company led by Álvarez-Pallete limited itself to pointing out, in relevant information sent to the National Securities Market Commission (CNMV), that “Telefónica takes note of the friendly approach of STC and its support for the management team, Telefónica’s strategy and its ability to create value.
Beyond this comment, the Spanish multinational has remained silent. Álvarez-Pallete received the announcement from STC in California. In the following hours he flew to Madrid and, later, took another flight to Riyadh. The manager knows perfectly well the Saudi ‘teleco’, which is, in fact, part of the GSMA, the sector organization that he has chaired since last year. Both companies, in fact, sealed an agreement last February on matters of cybersecurity, cloud and Big Data.
The Government has three months to analyze whether the direct purchase of the additional 5% by STC, to total 9.9%, complies with the regulations
The entry into the capital of the Saudi firm, controlled by the country’s sovereign fund PIF, has generated a great stir in the economic and, above all, political sphere. Various leaders of Sumar, Pedro Sánchez’s government partner, have positioned themselves against this operation. On the socialist side, vice president Nadia Calviño limited herself to saying that “we will protect the strategic interests of Spain” and this Tuesday the Minister of Inclusion, José Luis Escrivá, celebrated that Saudi Arabia opted for a Spanish company. “It’s good that there are investors as important as sovereign funds in the world!” She stressed.
The Government has three months to analyze whether the direct purchase of the additional 5% by STC, to total 9.9%, complies with the regulations relating to national security included in the Royal Decree of last July that regulates the so-called anti-opas shield of Spanish companies.