* Shareholder Ronny Pecik in talks with Carlos Slim
* Pecik holds 21 pct stake in Telekom Austria
* Slim's group America Movil seeking Europe expansion
By Georgina Prodhan and Angelika Gruber
LONDON/VIENNA, June 14 Telekom Austria AG
shareholder Ronny Pecik is in advanced talks to sell
his 21 percent stake to Mexican tycoon Carlos Slim, who is
seeking to expand his telecom empire into Europe, according to
people familiar with the matter.
If the talks are fruitful, it would be a big step in Slim's
effort to expand the footprint of his company America Movil
in Europe. Slim already owns 4.1 percent of Telekom
The Mexican telecom operator, which is now present in a
roughly a dozen Latin American countries, has also mounted a
raid on Dutch telecoms operator KPN via a tender offer
for 28 percent of its shares.
Pecik declined to comment on Thursday.
A spokesman for America Movil declined to comment.
Telekom Austria said in January that Pecik, via an
investment fund called RPR, had built a stake above 20 percent
in the group. Pecik's partner in the investment is Egyptian
entrepreneur Naguib Sawiris, who built his fortune in the
telecom business and is now a liberal politician.
At a shareholder meeting of Telekom Austria on May 23, Pecik
was elected to a board seat and said he was a long-term
shareholder, seeking to dismiss concerns that he and his
partners would aim for a quick profit by flipping the stake.
Pecik rose to prominence by building stakes with partners in
companies such as Oerlikon, Sulzer, Saurer, Ascom and VA Tech
before selling on at a profit.
Telekom Austria operates in Austria, Belarus, Bulgaria,
Croatia, Liechtenstein, Macedonia, Serbia, and Slovenia. Tough
conditions in Europe and fierce competition pushed its core
earnings down nearly 9 percent in the first quarter but the
company stuck to its 2012 outlook.
Its shares are down 13.5 percent this year, underperforming
an 8.2 percent decline in the European telecom index.
Telekom Austria has a market capitalisation of 3.5 billion
The Austrian state remains the largest shareholder with a
28.4 percent stake held via holding company OeIAG.
Pecik had earlier described Telekom Austria as an
undervalued pearl of industry despite a wave of corruption
scandals - which erupted after he started building his stake -
that has cost the group millions and tarnished its image. As an
ex-state owned monopoly the group is also seen as overstaffed
and having potential for cost cuts.
Sawiris, however, said in an interview with Bloomberg TV on
May 24 that he and Pecik were having difficulty convincing the
company and its state shareholder that their strategy to cut
costs to boost profits was the right one.
"If the government is not going to allow us to manage the
company the way we want then it becomes unattractive for us,"
Sawiris said at the time. "I am an industrialist. I didn't do
this deal to go in and buy and sell shares."