KPN calls off BASE sale

It claims that the non-binding offers received in the first round of bidding did not sufficiently reflect the "strong position and outlook" of BASE. Private equity suitors were rumoured to include Blackstone, Cinven and Providence.

Reports suggest that KPN was looking to sell at a 6x EBITDA valuation, which would correspond to an enterprise value of €1.6-1.7bn. Sources speaking to newswire Reuters suggested that bids were made far below this valuation.

The sale process stems from a strategic review conducted by KPN in an effort to trim its balance sheet. Last month, the company issued a €750m Eurobond, with a 3.25% coupon and February 2021 maturity date, in order to extend its maturity profile. KPN stated the proceeds would be used for general business purposes.

Earlier this year, the KPN boards attempted to fight off an unsolicited partial offer from Mexican telecommunications company América Móvil, controlled by billionaire Carlos Slim. The bidder eventually succeeded in securing a 27.7% stake in KPN, just below the 30% threshold that would require a mandatory offer for all outstanding shares. It is believed the management of América Móvil objects to the BASE sale, instead looking to build a larger European network.

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