(Reuters) – LinkedIn Corp (LNKD.N) and private equity firm Silver Lake Partners are among a number of parties that have expressed interest in a potential deal for Monster Worldwide Inc (MWW.N), according to people familiar with the matter, as the Internet jobs-search company is preparing data for potential buyers.

Monster, which runs Monster.com and HotJobs.com Websites, said in March it has retained Stone Key Partners and Bank of America Merrill Lynch (BAC.N) to review strategic alternatives, including selling all or part of the company.

New York-based Monster has since received expressions of interest from a broad range of strategic and financial buyers, including Internet powerhouse LinkedIn and technology-focused buyout firm Silver Lake, the sources said.

The company plans to send out financial information to the interested parties by the end of next week, they said.

Shares of Monster surged 19 percent to $9.33 in afternoon trading on the New York Stock Exchange, giving it a market valuation of more than $1.1 billion.

Monster’s 2012 share of online recruitment is estimated at 23 percent, below CareerBuilder.com’s 32 percent but ahead of LinkedIn’s 16 percent. The online recruitment market is estimated at more than $5 billion.

Representatives for Monster and LinkedIn declined to comment. Silver Lake, Stone Key Partners and Bank of America had no immediate comment.

Analysts have identified several possible avenues for Monster: an outright sale; the sale of a stake or some of its territories, such as its Chinese or South Korean assets; or a leveraged buyout.

The company’s model of job ads is facing new competition from social media such as Facebook and LinkedIn, and the company said in January it would cut 7 percent of its staff, or 400 jobs.

Its technology initiatives include Power Resume Search, which makes it possible to identify workers with specific skills, and BeKnown, a way for employers to reach candidates via Facebook. That “app” could make it easier to find so-called passive job candidates who are currently employed.

Monster, which bought rival HotJobs.com in 2010, also competes with operators of specialized job sites, such as Dice Holdings Inc (DHX.N), which focuses on financial, IT and other sectors, and with hundreds of small operators.

Aggregators of listings, such as SimplyHired.com and Indeed.com, have also emerged as rivals.

Although it’s an Internet company, Monster is susceptible to the same economic forces as traditional staffing companies like ManpowerGroup (MAN.N) and Robert Half International (RHI.N). The industry has seen a recovery in U.S. demand for workers, but softer staffing markets in Europe.

But SunTrust Robinson Humphrey analyst Tobey Sommer said recent U.S. job trends make the company more attractive. The types of jobs being created in the current U.S. labor recovery play to Monster’s strength in mid-level job categories, Sommer said.

(Reporting by Nadia Damouni, Soyoung Kim and Greg Roumeliotis in New York; Additional reporting by Nick Zieminski; Editing by Tim Dobbyn)

For a couple of years, Face.com has offered websites and apps a facial-recognition service that can identify people in photographs, figure out how many faces there are in the picture, which is male or female, and how old they might be. Facebook is widely believed to be one of its customers, though Face.com refuses to comment on their relationship.

But with mobile photo sharing gaining popularity, Face.com CEO Gil Hirsch says the company—which started out by building face-finding and -tagging Facebook apps—wanted to build a mobile app that, unlike existing apps that use the company’s technology, would give users real-time feedback about who their cell-phone camera is pointed at. It has done so with Klik, a free smart-phone camera app with the ability to recognize faces in real time and, if it can’t recognize them, learn who it is you’re shooting.

Originally released in January, the latest version of Klik rolled out on Thursday for the iPhone (an Android version is coming, but Face.com won’t say when). It’s a bit like Instagram, but with an AI twist.

Klik connects to your Facebook account and scans tagged photos of your friends, a process that can take a few hours. Once it’s ready, though, Klik can determine who you’re looking at before you’ve pressed the shutter. It also recognizes faces in photos that are already stored on your phone.

You can take photos, dress them up with simple filters, annotate them with messages and location data, and share them on Facebook or Twitter, through e-mail, or with other Klik users.

Hirsch can think of all kinds of applications for his company’s facial-recognition technology, from organizing family photos to enabling a service that could tell you more about whoever is standing in front of you.

Basically, Hirsch says, Klik picks up the presence of faces on the screen by scanning the video feed on the phone, frame by frame and pixel by pixel, searching for specific patterns it thinks make up a face. It tracks the face so it can still identify it even if it’s in profile. Klik sends that visual data to the company’s servers for processing, and returns with its best guess as to who’s in the picture.

(Reuters) – Sony Corp predicted a return to profit this year as it looks to halve the losses in its TV business that pushed the Japanese consumer electronics giant to a record loss of $5.74 billion in the year just ended.

Sony shares, valued at around $15 billion or just 3 percent of rival Apple Inc, this week slipped to a quarter century low, a sign of how the Walkman and PlayStation maker has lost its innovative edge and fallen behind Apple and Samsung Electronics.

Under new CEO Kazuo Hirai, Sony is slashing costs – 10,000 jobs, or 6 percent of the global workforce, will go – in a bid to turn around its struggling TV unit. At a briefing last month, Hirai sketched a future driven by mobile devices such as the Xperia smartphone, gaming and cameras, as well as medical devices and electric car batteries, along with big cost cuts in the TV business that has lost more than $12 billion in 9 years.

The company said on Thursday it expects to sell more than 33 million smartphones this year, up from 22.5 million last year. In preparation for that mobile push, Sony last year bought out Ericsson from a phone joint venture to integrate the business with its other consumer electronics units.

“In handsets, without big innovations, Sony will still be a second-tier smartphone market player,” said SR Kwon, an industry analyst at Dongbu Securities in Seoul. “I’m just not impressed by Sony smartphones.”

“Will Sony get much better as time goes by? I’m not that optimistic. Currency is not the only problem, the bigger problem is that Sony has failed to catch up with consumer trends in TVs and handsets.”

Sony expects an operating profit of 180 billion yen in the year to next March, slightly ahead of market estimates, but a rebound from a loss of 67.3 billion yen in the year just ended. It forecast a full-year net profit of 30 billion yen.

“The operating profit forecast isn’t far off the level seen two years ago … This suggests we’re on a recovery trend and last year was definitely the bottom,” said Kenichi Hirano, operating officer at Tachibana Securities in Tokyo. “But I think not everyone in the market is convinced of this, especially since the company lacks a solid plan to turn around its TV business.”

Sony’s net income forecast, though, was not as high as some had anticipated. “The net profit came in below expectations, but they’re projecting a strong operating profit, which I’m still doubtful they can achieve,” said Hiroyuki Fukunaga, chief executive at Investrust.

“It looks like they’re trying their best, but just looking at the figures it’s hard to see exactly how they’re going to increase margins.”

HIRAI’S BATTLE

Sony predicted sales of its liquid crystal TVs would fall 11 percent to 17.5 million in the current year, but forecast its losses from the LCD TV business would halve to 80 billion yen.

As TV technology moves on, Samsung reiterated on Thursday it plans to sell organic light emitting display (OLED) TVs from the second half of this year and reckons this will become mainstream TV technology within 2-3 years.

Hirai, who succeeded Welsh-born Howard Stringer last month, hopes to reduce Sony’s TV costs after exiting a joint LCD panel venture with Samsung. The Japanese firm in December agreed to sell its 50 percent stake in the panel production firm that had locked it into buying expensive panels as a market glut triggered a drop in the price of the main TV component.

Sony also sees an 11 percent decline in sales this year of its PlayStation games console, to 16 million. Sales of its new Vita handheld games console hit 1.8 million in the previous year, Sony said.

Sony’s January-March operating loss of 1.4 billion yen was narrower than the average 10 billion yen loss estimated by five analysts.

Hirai has set a target for group sales of 8.5 trillion yen ($106.85 billion) in two years, with an operating margin of more than 5 percent, but he has yet to spell out just how Sony will achieve those mid-term targets, and investors are concerned about Sony’s prospects as consumers flock to gadgets made by Samsung and Apple. Since the start of the year, Sony shares have dropped 12 percent, while the benchmark Nikkei 225 index has gained nearly 7 percent.

Hirai “seems to have the will to turn the company around, but he’s a young CEO and it’s unclear whether he will actually be able to,” said Investrust’s Fukunaga. “Until we see some progress it’s hard to judge whether they can meet their goals.”

Ahead of the results on Thursday, Sony shares closed down 1.2 percent at 1,213 yen, while the Nikkei average slipped 0.4 percent.

($1 = 79.5500 Japanese yen)

(Additional reporting by Mari Saito and Sophie Knight in TOKYO and Hyunjoo Jin and Miyoung Kim in SEOUL; Editing by Edwina Gibbs and Ian Geoghegan)

(Reuters) – Import prices in April recorded their largest drop in 10 months as energy costs tumbled, according to a government report on Thursday that also showed tame underlying inflation pressures from imports.

Overall import prices fell 0.5 percent, the Labor Department said. March’s data was revised to show a 1.5 percent increase rather than the previously reported 1.3 percent gain.

Economists polled by Reuters had expected prices to fall 0.2 percent last month. In the 12 months to April, import prices increased 0.5 percent, the weakest reading since October 2009.

Stripping out petroleum, import prices were flat as weak capital goods costs offset the largest increase in automobiles prices in 10 months, indicating that broader inflation pressures remained benign – in line with the Federal Reserve’s view.

Data on Friday is expected to show that weak energy costs held down wholesale prices in April for a second month in a row, according to a Reuters survey.

Outside food and energy, producer prices are expected to have moderated, with a gain of 0.2 percent forecast after a 0.3 percent increase in March.

Last month, imported petroleum prices fell 1.8 percent, the largest drop since August, after rising 4.9 percent in March.

That should pull down gasoline prices from their recent highs and support economic growth, despite signs of cooling in activity.

Imported food prices ticked up 0.1 percent after increasing 1.8 percent the prior month.

Elsewhere, imported capital goods prices were unchanged after advancing 0.2 percent in March. Imported motor vehicle prices rose 0.4 percent after increasing 0.3 percent the previous month.

The Labor Department report also showed export prices rose 0.4 percent last month, above analysts’ expectations for a 0.2 percent gain. Export prices increased 0.8 percent in March.

(Reporting By Lucia Mutikani; Editing by Neil Stempleman)

The world isn’t running out of oil and natural gas. It is running out of easy oil and gas. And as energy companies drill deeper and hunt in more remote regions and difficult deposits, they’re banking on information technology to boost production.

Data, in this case, really is the new oil. “It’s pretty sweeping,” says Paul Siegele, president of the Energy Technology Company at Chevron. “Information technology is enabling us to get more barrels of each asset.”

Oil companies are using distributed sensors, high-speed communications, and data-mining techniques to monitor and fine-tune remote drilling operations. The aim is to use real-time data to make better decisions and predict glitches.

The companies began to employ such technologies more than a decade ago, partly to help its aging workforce multitask remotely. But the technologies have gained speed along with the underlying trends: cheaper computing and communications technology, and a proliferation of data sensors and analytical software.

The industry term is the “digital oil field,” though the biggest companies have trademarked their own versions. At Chevron, it’s the “i-field.” BP has the “Field of the Future,” and Royal Dutch Shell likes “Smart Fields.”

Whatever these programs are called, they’ll play a huge role in the future of energy companies. The ones that are most successful at operating remotely and using data wisely will claim big rewards. Chevron cites industrywide estimates suggesting 8 percent higher production rates and 6 percent higher overall recovery from a “fully optimized” digital oil field.

That’s significant, says Siegele. Despite advancing renewable technologies, the International Energy Agency projects that global oil demand will still be growing by 2035 as more people use cars. And, as extraction becomes more difficult, almost $20 trillion in investments will be needed to satisfy these future needs.

Chevron is currently deploying up to eight global “mission control” centers as part of its digital program. Each is focused on a particular goal, such as using real-time data to make collaborative decisions in drilling operations, or managing wells and imaging reservoirs for higher production yields. The purpose is to improve performance at more than 40 of its biggest energy developments. The company estimates that these centers will help it save $1 billion a year.

At one machinery support center, opened in Houston in 2010 and expanded last year, shift engineers monitor visualizations and analytics from operations in Kazakhstan and Colombia. The center’s staff diagnosed a gas-injection compressor that showed subtle signs of overloading at Chevron’s Sanha Field off the coast of southern Africa. Operators there fixed the problem and avoided a potential loss of millions of dollars in downtime. Now there’s an automated early detection system based on the symptoms observed at that site.

Chevron first tested the i-field program in its century-old fields in California’s San Joaquin Valley, where it is using advanced thermal technologies to squeeze heavy oil from what might have once been considered a depleted reservoir. In the past, workers would drive around inspecting thousands of wells a day, says David Dawson, general manager of Chevron’s upstream workflow transformation organization. Now they use sensors and remote monitoring, and visit a well only when repairs are needed.

Since this early trial, real-time data analysis, imaging, and remote collaboration has become key to the setup at some of Chevron’s newest and most complex projects. These include projects in the deep waters of the Gulf of Mexico, off the coast of Nigeria, and 130 kilometers off the coast of Australia—the controversial $37 billion Gorgon Project, the single largest natural gas project in Australia’s history.

Real-time safety backups are also crucial as production gets more complicated, says Morningstar oil services equity analyst Stephen Ellis. Today, for example, Chevron is under fire in Brazil, where the company took responsibility for a 3,000-barrel offshore oil spill in November caused by an unanticipated pressure spike in a well. Siegele says Chevron’s i-field program will help prevent accidents and improve safety.

Much of the software innovation that’s key to the digitization of big oil is happening at oil service contracting companies, such as Halliburton and Schlumberger, and big IT providers including Microsoft and IBM.

Not every problem has been solved, however. It’s still tough to ensure reliable communications from the Arctic’s outer continental shelf, via fiber optic lines or satellite. Another limitation is data transmission speeds to relay pressure and temperature information from thousands of feet below the surface—although in recent years, electrically “wired” drill pipes have been able to relay this data an order of magnitude faster than before, at one megabit per second.

Already, Chevron’s internal IT traffic alone exceeds 1.5 terabytes a day. “The fire hose of data that comes up every minute and every hour is incredible,” says Jerry Hubbard, president of Energistics, a global nonprofit consortium working to standardize data-exchange formats within the energy industry.

Even startups are exploring the digital oil field. “The code in the old software platforms being used today, a lot of it is 20 years old,” says Kirk Coburn, who started Surge, a new Houston-based energy software startup accelerator with a digital oil section. “This technology can still be massively modernized.”

(Reuters) – In the weeks before Chesapeake Energy CEO Aubrey McClendon was stripped of his chairmanship over his personal financial dealings, he arranged an additional $450 million loan from a longtime backer, according to a person familiar with the transaction.

That loan, previously undisclosed, was made by investment-management firm EIG Global Energy Partners, which was at the same time helping arrange a major $1.25 billion round of financing for Chesapeake itself.

The new loan brings the energy executive’s total financing from EIG since 2010 to $1.33 billion and his current balance due to $1.1 billion, this person said. It was secured by McClendon’s personal stakes in wells that have yet to be drilled by Chesapeake – and by his own life-insurance policy.

A spokesman for McClendon declined to comment; a spokesman for Chesapeake didn’t respond to a request for comment.

The latest insight into McClendon’s personal financial deals comes in the wake of an April 18 Reuters investigation that found McClendon had borrowed heavily against his interests in wells owned by Chesapeake, mostly from EIG.

Last week, Reuters reported that McClendon had co-owned and actively invested in a $200 million hedge fund that bought and sold the same commodities produced by Chesapeake.

An outcry over potential conflicts of interest in the loans prompted inquiries by the Securities and Exchange Commission and the Internal Revenue Service. It also spurred Chesapeake’s board on May 1 to remove McClendon as chairman (though not as chief executive) and to declare an early end to a controversial perk at the center of the borrowings.

All told, McClendon has taken out loans worth $1.55 billion since 2009 from EIG and other lenders to fund his participation in Chesapeake’s Founders Well Participation Program. That perk enables him to receive a stake of up to 2.5 percent in all the wells Chesapeake drills in return for shouldering the same percentage of the wells’ costs.

The latest McClendon loan was arranged in late March through a McClendon-controlled company called Pelican Energy LLC, which was formed on March 6.

The deal was initially intended to be significantly larger, up to $750 million, said the person familiar with the transaction. It was scaled back last week after the Chesapeake board announced the early end to the well-stake perk, which is now slated to conclude in June 2014.

The newest financing for McClendon closed shortly before EIG joined with other investment firms and hedge funds, such as TPG Capital and Magnetar Capital, in purchasing preferred shares in a newly formed Chesapeake subsidiary that has an interest in some of the company’s wells. EIG invested $100 million in that deal, called CHK Cleveland Tonkawa, which raised $1.25 billion for Chesapeake.

An EIG spokeswoman declined to comment on the newest loan or on concerns of some analysts over EIG’s dual role as a financier to Chesapeake and its CEO.

In an April 23 letter to investors in two of EIG’s investment funds, EIG chief executive officer R. Blair Thomas said it is “simply untrue” that there was any conflict of interest in its loans to McClendon and dealings with Chesapeake.

The Securities and Exchange Commission has opened an informal inquiry into Chesapeake’s well program and the transactions involving McClendon.

In the letter, Thomas discussed two earlier loan deals that EIG had done with McClendon, involving McClendon-controlled entities called Larchmont Resources LLC and Jamestown Resources LLC. There was no mention in the letter of the financing deal completed in March to Pelican Energy.

The person familiar with the deal said Pelican was not mentioned in the letter because EIG clients “already knew about Pelican” and the loan hasn’t been disbursed yet.

This person added that when Pelican was launched, EIG sent a letter and “information packet” to clients advising them of the new financing and opening the loan vehicle up to investor participation.

EIG, which spun out of the Los Angeles-based bond shop TCW in 2011, has $13 billion of assets under management.

In the latest $450 million financing, EIG secured as collateral all the assets of Pelican Energy LLC. These include McClendon’s interests in wells Chesapeake might drill in 2013 and the first half of 2014. The EIG financing to Pelican will be used to enable McClendon to continue in the Chesapeake well program through June 2014.

For years, McClendon used companies he controls, including Larchmont, Jamestown and Arcadia Resources LP, to hold his stakes in the Chesapeake wells.

EIG funded Larchmont and Jamestown at $375 million and $500 million, respectively. EIG did not lend any money to Arcadia, which borrowed as much as $225 million in 2009.

The investors in the EIG funds that lent to McClendon include U.S. public pension funds, foundations and wealthy investors in Europe and Australia.

In his April 23 letter to clients, Thomas of EIG defended the two prior loans to McClendon, writing: “The crux of the story as it relates to EIG seems to be that we got too good a deal for our investors.”

(Reporting by Jennifer Ablan; additional reporting by Brian Grow, Anna Driver and Jonathan Stempel; Edited by Matthew Goldstein and Michael Williams)

(Reuters) – Stocks cut losses heading into the close on Wednesday of European markets, in choppy trading driven by increased fears about Europe’s debt crisis.

The S&P 500 earlier had fallen sharply to test support at around 1,340 before recovering of its losses just ahead of the close of stock trading in Europe.

The Dow Jones industrial average .DJI was down 62.48 points, or 0.48 percent, at 12,869.61. The Standard & Poor’s 500 Index .SPX was down 6.27 points, or 0.47 percent, at 1,357.45. The Nasdaq Composite Index.IXIC was down 10.59 points, or 0.36 percent, at 2,935.68.

(Reporting by Edward Krudy; Editing by Jan Paschal)

(Reuters) – Home prices rose in March for the first time since last July, helped by tighter housing inventory, data analysis firm CoreLogic said on Tuesday.

CoreLogic’s home price index gained 0.6 percent from February, but was still down 0.6 percent compared with March a year ago.

Excluding sales of distressed properties, prices climbed 0.9 percent on a yearly basis. Homeowners in danger of foreclosure, or in “distress”, often sell their homes at significantly reduced prices.

“This spring, the housing market is responding to an improving balance between real estate supply and demand, which is causing stabilization in house prices”, Mark Fleming, chief economist at CoreLogic, said in a statement.

Of the top 100 statistical areas measured by population, 57 showed year-over-year declines, down from 65.

The closely watched S&P/Case Shiller index released in late April showed a rise in U.S. single-family home prices in February for the first time in 10 months, with a gain of 0.2 percent on a seasonally adjusted basis.

(Reporting By Leah Schnurr; Editing by Leslie Adler)

(Reuters) – Dutch telecom group KPN NV (KPN.AS) hit back at a surprise stakebuilding attempt by Mexico’s America Movil (AMXL.MX), saying it was substantially undervalued by the 3.2 billion euros ($4.2 billion) plan designed to give the Mexican group a base for possible European expansion.

America Movil, the telecoms group controlled by tycoon Carlos Slim, is seeking a stake in KPN of up to 28 percent and sees it as a long-term investment that would give it a presence in Europe at a time when the Mexican group has run out of opportunities to expand at home.

But KPN said the offer was pitched too low. “KPN is of the opinion that 8 euros per ordinary KPN share substantially undervalues the company,” it said in a statement on Tuesday. “KPN will seek further clarification as to America Movil’s intentions … In the meantime, KPN will explore all strategic options.”

The deal, which if successful could give America Movil seats on KPN’s supervisory board, would also grant it a presence in Germany, where KPN has been trying unsuccessfully for years to merge its E-Plus unit with Telefonica-owned (TEF.MC) O2 Germany.

KPN shares surged more than 20 percent to their highest since early April, bouncing from a seven-year low set earlier this month.

Yet for KPN, the entry of Slim as a major investor will not solve the structural problems it has been grappling with, including tough competition in its home market and a lack of critical scale in the foreign markets where it remains.

America Movil, which has already built up a 4.8 percent stake in KPN by buying shares in the open market, is the biggest mobile operator in Latin America and a major cash cow for Slim.

The Mexican tycoon, ranked by Forbes magazine as the world’s richest man, has built his empire by purchasing troubled companies and turning them around.

“America Movil is a long-term investor, we think if the company (KPN) executes (its strategy) well, it will perform well,” Carlos Garcia Moreno, America Movil CFO, told reporters on Tuesday, adding there was scope to cooperate in areas like roaming, content, marketing and procurement.

Moreno said it was too early to say whether America Movil would do any other deals in Europe, but suggested KPN would allow it to get a closer look at European markets.

“KPN is the target for our first investment. Europe is facing some times which are economically challenging. We have a long-term investment horizon. We’ve taken our time. This one seems to make a lot of sense,” Moreno told reporters.

Moreno said the Mexican company had few opportunities to expand in Latin America, while Europe appeared attractive because of a similar cultural identity.

Some analysts said the approach could be a prelude to a full takeover offer.

“We believe the 28 percent stake could be a first step to try to gain full control of KPN,” SNS Securities said in a research note. “Buying an incumbent operator is politically not without risk, which may explain the cautious approach of first acquiring a 28 percent stake.”

One investment banker involved in the telecom sector said Slim had been looking to invest in Europe for several years.

“What they achieved today really matches their strategy, as they always wanted to start with a moderate investment and see what happens,” the banker said.

“It would make no sense for Slim to make a full bid for KPN right now. Instead, it is very shrewd from a non-European company to start with a minority stake and increment it over time … From Slim’s perspective, the stock is cheap and it’s a good asset.”

VERY LOW PRICE

One European telecoms executive said the move was an inexpensive way for America Movil to enter Germany, where E-Plus is the second-smallest player. “You get Germany at a very, very low price,” he said.

He added the entry of Slim as a major shareholder would almost certainly end any remaining ambitions for a merger of E-Plus and O2, whose parent Telefonica is a major rival to America Movil in Latin America. “If I was Carlos Slim I wouldn’t buy 28 percent of KPN in order to get rid of E-Plus.”

Shares of KPN, which traces its origins back to the Dutch government’s construction of telegraph lines in 1852, hit a seven-year low earlier this month, traded up 17.1 percent at 7.592 euros by 1533 GMT. America Movil stock was down 6 percent at 17.54 pesos, after touching a six-month high on Monday.

KPN, which has 45 percent market shares in the Netherlands in fixed line and mobile, posted coreearnings of 5.1 billion euros in 2011 and free cash flow of 2.45 billion.

But the company has been hit by a string of problems under Chief Executive Eelco Blok, a keen sailor and KPN-lifer who took the helm in April 2011, and has faced criticism from analysts, regulators, politicians and the public.

Analyst Ulrich Rathe at brokerage Jefferies in London noted KPN had underperformed the sector on a total return basis by 29 percent over the past year. “That is relative to a sector which has suffered a lot,” he said.

KPN has been struggling to reverse a decline in revenue, profit and market share in its fixed-line and mobile operations as it faces intense competition on its home turf. Its chief financial officer unexpectedly quit in January, citing disagreements over internal governance.

KPN and other mobile phone operators in the Netherlands are under antitrust investigation for possible price-fixing, while the local telecoms regulator put KPN under close supervision in December saying it may have broken the law to the detriment of consumers and competitors.

Another potential negative is that the Netherlands may get a fourth mobile operator at the next auction of mobile licenses later this year, since the regulator has set aside a chunk of spectrum at a low price for a new entrant.

Further competition could mean KPN’s mobile business in its key home market will become structurally less profitable.

Under pressure from shareholders to improve performance, KPN has started to look at divestments including the possible sale of its Belgian subsidiary.

Sources familiar with the company’s plans say KPN is mulling the sale of BASE, Belgium’s smallest operator, and wants 1.8 billion euros for it.

Earlier this month, Der Spiegel reported that E-Plus was in early talks to sell thousands of cell phone towers to a financial investor to raise funds for network expansion.

Those divestments could be put on hold if America Movil wants to use KPN as a foothold for expansion in Europe, one person familiar with KPN’s thinking said.

MERGER TARGET

KPN has been rumored as a takeover or merger target in the past, most recently in September 2011 when Belgacom (BCOM.BR) said a merger with KPN could make sense.

The Dutch firm has snubbed three bid attempts, KPN’s former chief executive Ad Scheepbouwer said last year, but he declined to give names of the companies involved.

Spain’s Telefonica has been most often cited as a possible buyer of KPN. The two firms held merger talks in 2000 which collapsed after KPN said it felt the Telefonica board was not committed to the proposed link-up.

A source familiar with KPN’s M&A talks said it had continued to seek tie-ups or strategic investors to boost its performance, including Chinese telecoms companies.

KPN is struggling to hold on to its market share as it invests in infrastructure in the Netherlands. As part of a major cost-reduction plan it aims to shed between 4,000 and 5,000 full time jobs, or up to 16 percent of the total, by the end of 2013.

America Movil, which said it already owns 4.8 percent of KPN’s stock, said it would make a cash offer of 8 euros per share for the additional stock, a premium of roughly 23 percent to Monday’s closing KPN share price.

Maurice Mureau, asset manager at Dutch brokerage and asset management firm Keijser Capital, said he did not expect a rival offer to appear.

“At this price, this is a good moment to say goodbye to KPN shares, so we are selling half our stake this morning,” Mureau said. “KPN’s business model is under pressure. They are losing share in the traditional telephone market and the new business in internet is not fully compensating for that.

“The competition is only getting tougher and things could go any direction,” Mureau added. “All-in-all a good time to get out of the stock.”

Deutsche Bank is advising America Movil on the KPN deal, which would also involve handling the tender offer if that goes ahead, while Clifford Chance is advising it on legal matters.

The deal would be the second major move on a Dutch company in recent months by an acquirer based in the Americas, after United Parcel Service Inc (UPS.N) announced plans to buy TNT Express NV (TNTE.AS) for 5.2 billion euros.

Previous Mexican investments in the Netherlands include a deal sealed in February for plastic pipe maker Mexichem (MEXCHEM.MX) to buy Wavin (WAVIN.AS) for 531 million euros.

($1 = 0.7663 euros)

(Aditional reporting by Anthony Deutsch; with Robert-Jan Bartunek in Brussels; Sophie Sassard and Georgina Prodhan in London; Ioan Grillo, Tomas Sarmiento and Dave Graham in Mexico City; Editing by Richard Pullin and David Holmes)