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Saudi Telecom Co. is taking a nearly 10 percent stake in Spain’s Telefonica SA for roughly $2.25 billion as the struggling Madrid-based carrier prepares to lay out a new strategy for future growth.

The Saudi government-controlled company purchased about 569.3 million shares and is using financial instruments that will altogether hand it a 9.9 percent interest in Telefonica once approved by regulators, according to a filing posted late Tuesday.

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The transaction was funded with a combination of the company’s own resources and bank debt.

Telefonica’s American Depositary Receipts rose 2.05 percent on Tuesday in New York.

The acquisition is bound to draw scrutiny from the Spanish government, which views Telefonica as a company of strategic importance, operating infrastructure that is critical to the nation’s defenses and security.

Stake acquisitions of more than 5 percent may require approval from the country’s cabinet. The carrier has long counted two Spanish banks, CaixaBank SA and Banco Bilbao Vizcaya Argentaria SA, as its anchor investors, and they altogether own less than 10 percent of the company.

Saudi Telecom made clear in a statement that it doesn’t plan to gain control or take on a majority stake in Telefonica. “We see this as a compelling investment opportunity to use our strong balance sheet whilst maintaining our dividend policy,” it said.

The approach by STC was “friendly” and the buyer is “supportive of the management team, Telefónica’s strategy and ability to create value,” the Spanish carrier said.

The acquisition comes as Telefonica’s executive chairman, Jose Maria Alvarez-Pallete, is preparing to lay out a new vision and strategy for his company at a November meeting, the company’s first capital markets day in over a decade.

Pallete, who has held the top job since April 2016, has for years struggled to attract investors and meaningfully grow profits in Spain, the firm’s biggest market. Shares have plunged by about 60 percent since he took over.

The Saudi Telecom stake also underscores the growing influence of Middle Eastern carriers in Europe. Abu Dhabi’s Emirates Telecommunications Group has emerged as Vodafone Group Plc’s biggest shareholder and agreed to pay $2.4 billion for a controlling stake in some of PPF Telecom Group’s assets in Eastern Europe — part of a government mandate to seek opportunistic deals.

Saudi Telecom is 64 percent owned by the Saudi sovereign wealth fund, which is chaired by Crown Prince Mohammed bin Salman. The company is the biggest telecom firm in the Middle East and has been looking to diversify its operations over the past few years.

For this, it has created a new tower operations unit, spun off its data center and internet services businesses and is building out a digital bank, STC Pay.

Earlier this year, the company announced the acquisition of a portfolio of telecom assets in eastern Europe in a deal valued at about $1.3 billion. Last year, it invested in towers in Pakistan.

Telefonica also operates in the UK, Germany and major Latin American markets. In recent years, it has been touting a strong shift toward expanding technology services for clients as well as investments in telecom infrastructure.

Earlier this year, Telefonica and Saudi Telecom signed a partnership, agreeing to explore joint business opportunities together in areas including cybersecurity and cloud services.

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