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CHSH Advises OIAG on Shareholders’ Agreement with America Movil

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CHSH has advised Osterreichische Industrieholding (OIAG) in connection with the negotiation and completion of a shareholders’ agreement with the Mexican "America Movil" (AMX) telecommunications company relating to shares the two hold in Telekom Austria. OIAG currently holds 28.4% of the shares in Telekom Austria, with America Movil holding another 26.8%.

The signing of the shareholders’ agreement triggers a mandatory takeover offer that has to be made by America Movil. The shareholders’ agreement enters into force upon completion of all regulatory approvals. The agreement also provides for a capital increase in Telekom Austria in the amount of up to EUR 1 billion and a joint growth strategy in Eastern Europe.

The influence of OIAG as the Austrian core shareholder is safeguarded by veto rights. An extensive “Austrian Package” has been agreed in favour of Telekom Austria. According to AMX, this Shareholders’ Agreement and the Public Offer are subject to certain regulatory approvals. Once such conditions are satisfied, the Shareholders’ Telekom Austria currently operates in Austria, Belarus, Bulgaria, Croatia, Serbia, Macedonia, Liechtenstein and Slovenia. As of December 31, 2013, it had approximately 2.6 million fixed line subscribers, 20.1 million wireless subscribers and revenues of €4,184 million. 

As of December 31, 2013, AMX had more than 339 million accesses. It ranks as the number one company in Latin America in all business lines (wireless, fixed lines, broadband accesses and pay TV subscribers), and operates the largest prepaid mobile virtual network operator in the United States. 

The agreement will become effective and AMX will obtain operational responsibilities in Telekom Austria.

AMX CEO Daniel Hajj said: “We are very happy to partner with OIAG, a key shareholder of Telekom Austria that has developed an extraordinary company with extraordinary people. The negotiations with OIAG, although intense, were constructive and professional. The main goal for both parties was the further development and future of Telekom Austria. This agreement provides the basis for future growth, continued innovation, and solid investment in Telekom Austria. It will strengthen the capital structure of Telekom Austria; maintain a state of the art infrastructure in a very dynamic and competitive sector, and support job development and creation. In this way, Telekom Austria will continue to contribute with services that are strategic for the economic and social development of the country. It will also contribute to better position Telekom Austria as a more relevant player in the European telecommunication markets and to be in a position to benefit from growth opportunities in the region.”

CHSH Partner Edith Hlawati said of the deal that, "it was a great pleasure to represent OIAG on this transaction and to negotiate the terms of the shareholders’ agreement that also safeguards Telekom Austria’s interests. We have had a long term relationship with both OIAG and Telekom Austria. The mandate was challenging for the negotiation teams due to the tight time frame for the finalisation of the agreements. As the negotiations took place in Mexico City and Vienna, the legal teams had to work nightshifts and over the Easter holidays. We are all the more happy about the successful completion!“

Hlawati was assisted by CHSH attorneys Christian Aichinger and Elisabeth Gruberm, as well as Partner Bernhard Kofler-Senoner and his merger-control and regulatory team.