Business World

Monday 16 December 2019

World's richest man Carlos Slim bets on European recovery with Dutch phone company purchase

Carlos Slim amassed much of his $76bn fortune in Latin America's mobile phone market
Carlos Slim amassed much of his $76bn fortune in Latin America's mobile phone market

Richard Blackden

CARLOS Slim, the world's richest man, plans to buy almost a third of Holland's biggest phone company in a move that may herald an aggressive European expansion by the Mexican billionaire.

Europe's phone industry was left stunned after America Movil, the Mexican mobile phone company controlled by Mr Slim, offered €2.6bn to increase its stake in Royal KPN to 28pc. The 72 year-old, who amassed much of his $76bn (€58.5bn) fortune in Latin America's mobile phone market, has previously tried to enter the European market.

Raising his stake in KPN from just under 5pc gives the billionaire exposure to Holland as well as Germany, where the Dutch company owns one of the country's four largest phone operators.

The move is a bold one as Europe's two-year old debt crisis threatens to deepen in the wake of elections in France and Greece. Analysts said that the stake in KPN may mark the beginning of a sustained expansion by Mr Slim in a region in which the debt crisis has left the share prices of many companies languishing. Before Tuesday's offer of €8 a share, KPN's stock had lost almost a third of its value this year.

Carlos Garcia-Moreno, America Movil's finance director, said that "it would clearly be a possibility to continue to look at Europe, but we cannot run before we walk". He also added that the region, which is forecast to spend much of this year in recession, "should return to the growth scenario in the not too distant future".

Mr Slim's profile has increased beyond Mexico in the past couple of years after he ousted Mircosoft founder Bill Gates at the top of the annual Forbes Rich List. His fortune really began to grow when Mexico privatised its national phone company in 1990, an auction that Mr Slim won ahead of America's Southwestern Bell and France Telecom.

Although that phone company, Telmex, and America Movil are at the heart of his fortune, his interests in Mexican retail and restaurants prompted the phrase "Slimlandia" to describe the extent of his presence in the country. Mr Slim also owns a stake in The New York Times.

KPN said it was "moderately positive" about the offer from Mr Slim, while some KPN investors said they would be selling their shares to the billionaire.

KPN shares rose €1.103 – or 22.5pc – to €7.583.

Meanwhile, Mexican immigrant groups in the US are threatening to boycott telephone companies owned by Mr Slim to protest what they say are abusive charges.

"Carlos Slim's monopolistic practices have imposed significant costs to the Mexican economy and burdened the people of Mexico and Latin America," said Juan Jose Gutierrez, of the nonprofit organization VAMOS Unidos USA.

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