VIENNA A vote on a shareholder pact at Telekom Austria between Mexican tycoon Carlos Slim and the Austrian government was boycotted by labour representatives on Wednesday, three sources familiar with the situation said.
A majority of the supervisory board of the OIAG state holding company would have to vote in favour of the pact, which would trigger a joint takeover bid and open the way for Slim to take control of Telekom Austria.
Five worker representatives on the 14-member supervisory board refused to take part in the vote at its Vienna headquarters, the sources said.
It was not immediately clear how many of the other nine board members were in attendance. A Reuters reporter saw at least four arriving for the meeting. The reporter did not see any of the labour representatives or the board's chairman.
Telekom Austria shares were down 3.9 percent at 6.6 euros at 1411 BST.
The labour representatives were unhappy that the contract did not contain job guarantees, did not ensure that the Austrian government would maintain leadership and did not specify the company's future strategy, one of the sources said.
"This is no partnership of equals," the source said, adding that the board members had been given only one day to study the syndicate agreement, which was well over 100 pages long and written in English.
An agreement to found a syndicate to hold the stakes of Telekom Austria's two biggest shareholders would be Slim's first significant step towards operational control of a telecoms operator in Europe, where he made his first investments in 2012.
Apart from Telekom Austria, Slim also spent $3.4 billion (2 billion pounds) on acquiring a large stake in KPN of the Netherlands, but was rebuffed in an unsolicited offer for the rest of the company.
The syndicate agreement was marketed in Austria as a way of gaining a reliable long-term investor for the country's biggest telecoms company while securing the state's ongoing influence by ensuring that important decisions would need the approval of both Slim and the government.
The source said the contract included a provision for a 1 billion euro (833.7 million pounds) rights issue of new stock by Telekom Austria, but did not specify what the funds would be used for.
In the case of a large rights issue, America Movil - which has deeper pockets than the cash-strapped Austrian government - would be likely to take control of the former state monopoly.
Austria has said it aims to keep a stake of at least 25 percent in Telekom Austria, but has declined to commit to keeping pace with Slim in any capital increase.
One of the sources said the labour representatives had sent written notice of their intention to boycott the meeting to the deputy chairman of the OIAG supervisory board, since the chairman, Peter Mitterbauer, was out of town.
Mitterbauer's company, Miba AG, referred the question of whether Mitterbauer was in attendance to the OIAG.
An OIAG spokesman said the board meeting was still in progress but declined further comment.
(Additional reporting by Angelika Gruber; editing by David Holmes and Tom Pfeiffer)