The Saudi Telecom Company (STC) has bought a 9.9% stake in Telef?nica for EUR2.1 billion, making it the largest shareholder in the Spanish telecommunications company.

Telef?nica has informed the National Securities Market Commission in Spain of the transaction, which will be carried out through the STC Group’s acquisition of shares representing 4.9% of Telef?nica’s share capital and through its acquisition of financial instruments for the other 5%.

The telecoms company is one of the largest telephone operators and mobile network providers in the world.

STC has no intention of acquiring control or a majority stake in Telef?nica, according to its CEO. Olayan Alwetaid stressed that “this is a great investment opportunity that allows us to use our solid balance sheet while maintaining our attractive dividend policy”.

Until this moment, Spanish bank BBVA was Telef?nica’s largest shareholder, with 4.87%, followed by US fund BlackRock with 4.48%.

STC will obtain the voting rights corresponding to the 5% in financial instruments after obtaining the necessary approvals from regulators.

The group says the investment reflects its confidence in Telef?nica’s management, strategy, and ability to create value.

Saudi Telecom Company is the Middle East’s digital leader and is listed on the Saudi Stock Exchange with a market capitalisation of EUR49.2 billion.