Spanish Prime Minister Pedro Sanchez said that his government is “analysing” STC Group’s move to become the top shareholder of telecom giant Telefonica, and will guarantee that the country’s national defense and security are protected.
Saudi Arabia’s largest telecoms provider, which is majority owned by the kingdom’s sovereign wealth fund, PIF, has acquired a 9.9% stake in Telefonica for about $2.25 billion.
“The government is analysing the investment operation thoroughly,” Sanchez was quoted by Bloomberg as saying on Friday.
“We have the adequate instruments to exercise the necessary controls and we will guarantee that at all times national defense and security, understood in a broad sense, will be safeguarded.”
The acquisition, which is still subject to state approval, will make STC the largest shareholder of Telefonica.
STC is the largest telecoms provider in Saudi Arabia. It owns shares in businesses operating in Bahrain and Kuwait. PIF has a 64% stake in the company.
Sanchez noted that the government will also ensure that “any foreign investment will not exceed the limits that would involve undue influence over strategic companies, or access to critical technologies.”
(Writing by Cleofe Maceda; editing by Seban Scaria)