MADRID (Reuters) – Saudi Arabia’s largest telecoms operator, STC Group, will seek a seat on Telefonica’s board, it told the U.S. markets regulator in a filing, six days after the Spanish company unexpectedly replaced its chief executive.
STC told the U.S. Securities and Exchange Commission late on Thursday it now owns 9.97% of Telefonica and was planning “to engage in discussions with the issuer to seek a board seat”.
Telefonica, which has American Depositary Receipts listed in the U.S., did not immediately respond to a request for comment.
The Spanish telecoms giant has undergone an ownership shake-up since STC announced it intended to become a major shareholder in September 2023.
Since Telefonica is considered a defence service provider and therefore strategic, the Spanish government reacted to the STC announcement by buying its own 10% stake through state holding company SEPI, while Spanish holding company Criteria also raised its stake to 9.99%.
After the two moves, the government eventually authorised STC to raise its stake to close to 10% in Telefonica in November 2024.
STC’s intention to get a representative on Telefonica’s board comes after the Spanish company held an extraordinary meeting on Saturday to replace CEO Jose Maria Alvarez-Pallete with Marc Murtra, until then chairman of defence company Indra, following a request by SEPI.
Telefonica’s shares have fallen 4.3% since the management shake-up was announced, with investors wary of political interference.
(Reporting by Emma Pinedo and Inti Landauro. Editing by Mark Potter)
