MADRID (Reuters) - French telecom giant Orange (ORAN.PA) said on Thursday it does not plan to make a rival bid for Spanish telecom operator MasMovil (MASM.MC) after three buyout funds made a 3 billion euro ($3.4 billion) offer on Monday.
“Orange is not contemplating a counter-offer for MasMovil group,” the company said in an e-mailed statement on Thursday, dismissing an earlier report from Spanish newspaper El Economista, which said the board would discuss a possible counter bid, citing unidentified industry sources.
Since KKR (KKR.N), Cinven and Providence launched their 2.96 billion euro offer on Monday, MasMovil stock has been trading above the 22.50 implied share price, suggesting investors expect rival bids or a sweetened offer from the funds.
The shares traded 0.4% higher in early trading on Thursday then erased the gains after the Orange statement.
The private equity trio said holders of 29.56% of MasMovil’s stock had already agreed to sell at the price they offered. These shareholders have committed to remain loyal to the offer in the case of any counter bid lower than 26 euros.
Even though it dismissed bidding for MasMovil, Orange said it intended to keep expanding in Spain.
“Orange has a privileged position in the telco sector in Spain and has the support of the Orange group to continue growing organically in the country,” it added in the statement.
Reporting by Inti Landauro; Editing by Nathan Allen and Emelia Sithole-Matarise