He learned Saudi Arabia's largest telecoms operator, STC Group, aimed to be Telefonica's biggest shareholder, with an interest of 9.9%.
The move is a vote of confidence in Telefonica, burdened by billions of dollars in debt while STC gains expertise to modernize Saudi telecoms infrastructure.
As Telefonica's rivals slashed prices to attract internet users, the Spanish company also borrowed to invest in new mobile and internet networks.
STC sought to keep the stake under wraps until it could buy at least 9.9% of Telefonica, the person said.
Middle Eastern investors have been taking stakes in Spanish companies for some time.
Persons:
Violeta Santos Moura, Jose Maria Alvarez, Pallete, Alvarez, Prince Mohammed bin Salman's, UGT, Morgan Stanley, Linklaters, Motaz Al Angari, Al Angari, pare, EFG Hermes, Inti Landauro, Tomas Cobos, Amy, Jo Crowley, Pablo Mayo, John O'Donnell, Anousha, Elisa Martinuzzi, David Gregorio Our
Organizations:
Spanish Telecom, REUTERS, Rights, Telefonica, STC Group, STC, Saudi Arabia's Public Investment Fund, Foresight, Saudi, United Arab, Vodafone, Thomson
Locations:
Madrid, Spain, Rights DUBAI, MADRID, Silicon Valley, Saudi, Riyadh, Telefonica, Saudi Arabia, Spanish, Latin America, theocracies, United Arab Emirates, Iberdrola, Davos, Gulf, London