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Business

Billionaire Carlos Slim agrees to Telefonica-E-Plus deal

The likelihood of Telefonica Deutschland taking over mobile telecommunications company E-Plus has increased tremendously. America Movil's billionaire Carlos Slim has finally given his blessing for the deal.

Carlos Slim, a crucial shareholder of E-Plus' Dutch parent company KPN, was reported Monday to have agreed to Spain's Telefonica takeover E-Plus.

Telefonica, arch rival of Carlos Slim's Mexican America Movil, said the billionaire would formally cement his approval at an extraordinary KPN shareholder meeting on October 2. It added that although all companies concerned had now reached a deal, the merger was still subject to approval from regulators.

America Movil and Telefonica together control about 60 percent of the mobile phone business in Latin America. America Movil's purchase of stakes in KPN and Telekom Austria has brought its rivalry with Telefonica to mainland Europe, with experts believing for a long time that a Telefonica Deutschland-E-Plus Merger would never materialize.

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European telecoms firms have been struggling with saturated markets, recession-hit consumers, tough regulation and expensive network upgrades, leading some to look for opportunities in other markets.

According to Reuters news agency, Telefonica Deutschland (O2) has raised its bid for E-Plus, now considering it worth 8.55 billion euros ($11.44 billion).

Due to a change in conditions for the deal, KPN is to own a 20.5 percent stake in the merged company, up from a previously cited 17.6 percent. However, Telefonica is to receive a call option for up to 2.9 percent.

hg/kms (AFP, Reuters, dpa)

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