America Movil's KPN takeover reportedly held up over price

Mexican telecoms giant America Movil's slated takeover of KPN, The Netherlands' largest mobile operator, has reportedly hit a barrier over price.

According to Bloomberg sources, KPN's board are holding out for a higher price which America Movil seems to be currently reluctant to offer.

The Dutch network wants America Movil, which already owns 30 per cent of the firm, to raise its €2.40 (£2) a share offer, presenting the arguments that the recent sale of its German network E-Plus to Telefonica has boosted KPN's value.

America Movil, the world's fourth biggest operator, is however countering that the entry of Ziggo, the largest cable operator in The Netherlands into the country's mobile market represents deteriorating prospects for KPN, and so validating the original price.

KPN is thought to be looking for €2.65 (£2.22) a share, amounting to €7.9 billion (£6.6 billion). America Movil's biggest hurdle is winning over an independent foundation which is KPN's biggest shareholder, owning just under half of the company. This gives the foundation the right to reject any takeover offers.

"With KPN looking for a raised bid of €2.65 (£2.22) a share rather than something closer to €3 (£2.50), this keeps it still within reach for America Movil," Usman Ghazi, an analyst at London's Berenberg Bank told Bloomberg.

"America Movil staying at €2.40 (£2) could be an attempt to drive expectations down before the actual tender offer," he added. "The big question remains what America Movil's end game is with KPN and if it has other plans for KPN that require funds."