Telefonica has won the support of America Movil in its quest to buy E-Plus from KPN after sweetening its offer for the German operator.

America Movil, which is KPN’s largest shareholder, said it will vote in favour of the improved bid at a forthcoming EGM after Telefonica increased its total offer to €8.55 billion from €8.1 billion.

As part of the improved terms, KPN will acquire a 20.5 per cent stake in Telefonica Deutschland.  Previously, it was in line for a 17.6 per cent post-deal stake. The Dutch operator will also receive €5 billion in cash, as previously agreed.

After one year, Telefonica has the option to acquire a 2.9 per cent stake in the German business from KPN for the sum of €510 million.

The Mexican group’s statement of support for the Telefonica bid may also reduce opposition to its own proposed €7.2 billion takeover of KPN. It already owns nearly 30 per cent of the Dutch operator.

America Movil needs the support of management, unions and the KPN Foundation, an independent body that has the power to put a significant obstacle to any takeover bid. The foundation has previously voiced its concern about the bid.

The Mexican group’s statement went out of its way to reassure these stakeholders regarding its intentions.

It said KPN’s headquarters will remain in The Hague, its brand will remain untouched and the Dutch company will “continue to investigate expansion investments that will differentiate KPN as a leading telecom service provider in its home markets”.

Plus, unless a significant majority of shareholders accept the offer, leading to America Movil having a shareholding of 95 per cent of more, the group expects KPN to maintain its Euronext Amsterdam listing.

America Movil said KPN “must continue to have proper corporate governance rules customary for public companies”, including protection for minority shareholders.

Senior executives from America Movil are due to meet Dutch government ministers on 28 August to talk up its takeover.