In March 2007, more than a year after Sonaecom had declared its first takeover bid for Portugal Telecom (PT), matters had advanced: new investors had come along, the authorities had approved the deal, both parties were holding roadshows, and eventually Sonaecom raised its offer price to EUR10.50. The day before the final shareholders' meeting (2 March 2007), when the votes would be counted, everyone was doing their own amounts. According to the bylaws of the firm, votes cast by an individual investor whose shares surpassed 10% of the share capital wouldn't be counted.
Sonaecom's offer was conditional on the removal of this restriction. The removal of this constraint had to be approved by two-thirds of the stockholders present at the AGM. After that, for the offer to be successful, Sonaecom would need to have the support of at least 50.01% of PT's stockholders to its EUR10.50 per share offer. This was one of the biggest deals in the Telecoms sector, and investors from around the world were putting their bets on who was going to win the battle.
SONAECOM TAKEOVER OF PORTUGAL TELECOM (D) b case study solution
PUBLICATION DATE: January 01, 2012 PRODUCT #: IMD655-HCB-ENG
This is just an excerpt. This case is about FINANCE & ACCOUNTING
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