Carlos Slim threatens to walk away from KPN bid

Carlos Slim threatened today to walk away from his $9.5 billion offer to buy the 70% of Dutch telecom Royal KPN NV he doesn't already own after a foundation linked to the company mounted a "poison pill" defense.

The KPN Foundation is a body peculiar to the Netherlands formed to defend the rights of not only shareholders, but also workers and customers. Yesterday it said it viewed Slim's bid of 2.4 euros per share as hostile and exercised its right to issue temporary preference shares worth 49.9% of voting rights in KPN, effectively blocking Slim's bid.

Today, the Mexican billionaire's company, America Movil responded in a statement that its plans will benefit KPN and it could withdraw its bid if the foundation persists.

If the foundation "maintains its current position and seeks to prevent the offer from proceeding, to the detriment of KPN's customers, employees and shareholders, and also to the detriment of telecommunication services in the Netherlands, all of whom America Movil firmly believes will benefit from the offer, America Movil is prepared to withdraw its offer," it said.

KPN shares fell 5.6% to 2.16 euros in early Amsterdam trading.

The Foundation, which has 5 directors and acts independently, said the main reason for its move is that Mobil hasn't yet published details of its offer, and therefore it is impossible to know how stakeholders may be affected, though in its press releases, Movil has said it plans to invest in KPN and maintain its brand.

"The Foundation believes that America Móvil should, in accordance with... What is common practice in the Netherlands, open negotiations with KPN's Board of Management and the Dutch government as soon as possible."

It is not clear what role, if any, the government should have in the matter.

KPN spokesman Stefan Simons said KPN's boards "are in contact" with Movil "and we would like to continue that.