CriteriaCaixa, the investment arm of the La Caixa banking foundation, has taken a step forward in Telefónica. The entity chaired by Isidro Fainé has reached 9.99% of the operator’s capital, according to a relevant fact sent to the market regulator (CNMV), after acquiring an additional 4.91%. With this purchase, which would exceed 1,000 million euros at market prices, Criteria almost equals the participation of the State Industrial Participation Company (SEPI), which holds 10% of the capital of the telecommunications company.
Criteria intends to reach “a maximum” of 10.01% of Telefónica’s share capital, according to the statement, so it will continue to acquire additional shares if it achieves “administrative authorizations” for the acquisition of an indirect participation in certain regulated subsidiaries of Telefónica.
The investment company already announced on May 21 its intention to undertake this operation in Telefónica, and to go from 5% to 10% in the near future, and with the purchase of 4.91% it is about to reach its objective, in a move anticipated by The confidentialThe cost of this latest transaction, given the share price of the company headed by José María Álvarez Pallete, would be around 1,000 million euros.
The movements around Telefónica’s shareholding have occurred since Saudi Telecom (STC) entered the capital of the Spanish company in September of last year, when it acquired 4.9% of the shares. However, he left pending the purchase of another 5% obtained through stock derivatives. As Telefónica is a strategic company, with activities related to defense or cybersecurity, Royal Decree 571/2021, of July 4, establishes that the Executive must authorize any percentage higher than 4.99% and, therefore, the execution of these financial instruments.
He impasse with STC, almost a year later, is relevant in that it has ended up defining the strategies of the rest of the actors in the capital. Initially, the Spanish core present in the shareholding marked a roadmap that allowed maintaining a status quo The idea was that CriteriaCaixa, BBVA and the recently incorporated SEPI would accumulate equal shares of up to 15% of the capital, enough to control STC if it remained at 5%. However, the threat of that additional 5% forced the Government to increase SEPI’s participation target to 10%, disbursing almost 2.3 billion euros, and Criteria -now- also has to reach another 10%.
In parallel, the holding company chaired by Isidro Fainé announced a few days ago a strategic plan whose main objectives are to increase the gross value of its assets by 48%, up to 40 billion euros, and achieve dividends of up to 700 million (75% more) for the foundation. In a drastic strategic shift coinciding with the appointment of Ángel Simón as CEO, the entity has recently entered Puig, ACS and Colonial, while leaving Cellnex. The new times, however, have as a setback the failed solution to the shareholding problem of Naturgy. The fiasco of the pact with the Emirati company Taqa to facilitate the exit of the capital of the CVC and GIP funds has greatly complicated the situation at the gas company.
“Our preference is for consolidated businesses, with expansion opportunities, with solid financial positions and continuous and growing dividend payments,” said Criteria’s president, Isidro Fainé, during the presentation of the strategic plan. In the case of Telefónica, the shareholder movements have already had an impact on the board of directors. The State Society of Industrial Participations (SEPI) proposed Carlos Ocaña as a director of the operator at the beginning of May, representing the public group.
At the beginning of April, the Minister of Economy, Trade and Business, Carlos Cuerpo, confirmed that the Government would request a seat on the board, while insisting on its desire to remain in the company. “SEPI’s participation will allow Telefónica to provide greater shareholding stability so that the company can achieve its objectives and, therefore, will contribute to safeguarding its strategic capabilities,” he said.
At the last shareholders’ meeting, Pallete, although he did not specifically mention STC and SEPI in his speech, did refer to both groups indirectly. “We welcome those who have decided to participate in this future and, of course, we thank those who have walked the path with us, large and small, because they knew where to be,” said the executive in his speech. Later, in his answers to questions from shareholders, Pallete added that the new shareholders contribute to the shareholder stability of Telefónica, which “reflects long-term confidence in the company’s strategy.”
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