Zegona looks to raise stake in Spain's Euskaltel via tender

LONDON, Oct 19 (Reuters) - Zegona Communications said on Friday it would increase its stake in Spain’s Euskaltel by offering to buy 14.9 percent of its shares for 7.75 euros each, with the objective of increasing its presence on the group’s board to drive expansion.

Zegona, set-up by former Virgin Media executive Eamonn O’Hare to invest in European telecoms, already owns 15 percent of the Northern Spain-focused group.

“We see opportunities where our industry knowledge and experience can be valuable to Euskaltel, and we look forward to continuing our constructive relationship with the leadership team to help return the business to growth,” he said.

Zegona said there was potential to increase revenue, cut costs and accelerate expansion of the company.

Shares in Euskaltal jumped 11 percent to 7.32 euros in early deals.

Zegona said it would fund the investment through an equity raising of up to 225 million pounds from institutional investors. (Reporting by Paul Sandle; Editing by Kirsten Donovan)