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FRANKFURT/VIENNA, Nov 7 (Reuters) - Telekom Austria announced its long-awaited 1 billion euro ($1.24 billion) capital increase on Friday, with Mexican tycoon Carlos Slim’s America Movil as well as Austrian OIAG together taking up 88.12 percent of the cash call.
The rights issue will start on Nov. 10 and is expected to end on Nov. 24, Telekom Austria said. Trading on the Vienna Stock Exchange is expected to begin on Nov 27. Telekom Austria’s roadshow will start next week and stretch from Europe, including London, to the United States.
The company said shareholders would be entitled to one new share for every two existing Telekom Austria shares they own. It is offering 221.5 million shares at a price of 4.57 euros to existing shareholders and new investors.
Telekom Austria shares hit their lowest since January on Thursday, closing 0.88 percent down at 5.849 euros. They were 3.3 percent lower in pre-market trading.
America Movil had told Reuters on Thursday that it plans to subscribe to Telekom Austria’s capital increase in proportion to its shareholding in the company, which is 59.7 percent.
Slim’s group has said it wants to use Telekom Austria as a base for further expansion into central and eastern Europe, where Telekom Austria already has operations in six countries including Bulgaria and Croatia.
Telekom Austria wants to use the cash injection to strengthen its capital structure, speed infrastructure investments focusing on the Austrian market as well as mergers and acquisitions, it said.
Austrian state holding company OIAG had said it does not want its 28.42 percent stake to be diluted. With Slim and OIAG making full use of their rights, this would leave about 119 million euros of stock for the market.
“They’re going along with it fully, which shows the commitment of the shareholders to Telekom Austria,” a spokesman for the company said. ($1 = 0.8074 euro) (Reporting by Maria Sheahan and Shadia Nasralla; Editing by David Goodman)