Shares fall and shareholder stc is requesting a seat on the board since the state ousted the operator’s long-standing chair and CEO last week
The Saudi-backed telco, stc, is to request a seat on the board of Telefónica just days after state intervention requested the resignation of the operator group’s long standing CEO and Chair, Jose Maria Alvarez-Pallete. So far the operator group has not issued a response.
Last week Carlos Cuerpo, Spain’s Economy Minister, told the Financial Times [subscription needed] at Davos that the government, STC and other shareholders had a “common” long-term strategy for Telefónica, adding the Spanish incumbent is valued at €21 billion.
stc has just short of a 10% stake in the Spanish operator group via an investment vehicle based in Luxembourg, Luxco. It acquired the stake in 2023 and became the operator’s single biggests shareholder. Its request to have a representative on Telefónica’s board came to light in a filing with the the US Securities and Exchange Commission (SEC), reported by Reuters.
In response to stc acquiring this stake, the Spanish government bought a 10% stake via the state’s investment company, Sociedad Estatal de Participaciones Industriales (SEPI). It also gained a seat on the board which was the lever used to oust Alvarez-Pallete in a board meeting on 19th January. He was replaced by Marc Murtra, former chair of Spanish defence and tech firm Indra who has is seen as having close links to the state.
Reuters also points out that Telefónica’s share price has fallen almost 5% on the Madrid exchange to €3.78. It seems investors are spooked by political interference.
