Tuesday December 10 11:13 AM EST
NTT DoCoMo Stake in KPN Mobile Falls to 2.2 Pct
AMSTERDAM (Reuters) - Dutch telecoms group KPN said on Tuesday NTT DoCoMo's stake in KPN Mobile would dwindle after its Japanese strategic partner declined to subscribe to additional shares in the unit.
KPN, which said last week it did not expect Japan's largest wireless carrier to assist in its plan to recapitalise the mobile business, said that NTT DoCoMo's stake in KPN Mobile would fall to about 2.2 percent from 15 percent.
"KPN fully respects NTT DoCoMo's decision and looks forward to continuing the successful strategic partnership with NTT DoCoMo," KPN said in a statement.
Last month the Dutch operator said it would recapitalise its mobile phone division by converting 14 billion euros of loans it has made to KPN Mobile into shares by the end of the year.
Due to NTT DoCoMo declining to subscribe to the additional shares, KPN Mobile's board decided on Tuesday to issue seven billion shares worth two euros each to KPN.
KPN's recapitalization of the mobile unit was widely perceived as preparation for an acquisition of a mobile telecoms business, perhaps in Germany.
The Japanese company's decision marks a further retreat from its widely criticized foreign investment strategy, carried out at the height of a telecoms bubble a few years ago.
DoCoMo has faced mounting shareholder criticism of a 1.9 trillion yen overseas spending spree several years ago on minority stakes in several foreign carriers, including nearly 410 billion yen paid in 2000 for 15 percent of KPN Mobile.
DoCoMo's strategy, promoting its "i-mode" mobile Internet service and high-speed third-generation mobile technology, backfired when the telecoms investment bubble burst last year.
The evaporating value of its foreign holdings forced DoCoMo to book 813 billion yen in appraisal losses in the last business year to March and another 573 billion yen in the first half of this year, when it wrote down its KPN Mobile stake to zero.
KPN's shares did not react to the news and remained flat at 6.13 euros at 1542 GMT.