Saudi Arabian STC wants a seat on Telefonica's board

STC Group will apply for a seat in Telefonica's Board, the U.S. regulator of markets was informed by the Saudi Arabian company six days after Telefonica unexpectedly replaced the chief executive.

STC informed the U.S. Securities and Exchange Commission on Thursday that it owned 9.97% in Telefonica and planned to "engage in discussions with issuers to seek a seat on the board".

A request for a comment from Telefonica regarding its American Depositary Receipts in the U.S. was not immediately responded to.

Since STC announced its intention to become a majority shareholder in September 2023, the Spanish telecoms giant underwent a shake-up of ownership.

The Spanish government, which considers Telefonica a strategic service provider in the defence sector, reacted by purchasing its own 10% stake via the state-owned holding company SEPI. Criteria, meanwhile, increased its stake from 9.99% to 10.99%.

In November 2024, after the two actions, the government finally authorized STC to increase its stake in Telefonica to almost 10%.

STC wants to have a representative in the board of Telefonica after the Spanish company, SEPI, requested that Marc Murtra replace Jose Maria Alvarez Pallete, CEO, at an extraordinary meeting held on Saturday. Marc Murtra was previously chairman of Indra, a defence company.

Investors are wary of any political interference. Reporting by Emma Pinedo, Inti Landauro. Mark Potter edited the article.

(source: Reuters)