Following Friday’s news that an Argentinean appeals court has suspended the timetable by which Telecom Italia must sell off its 50% stake in Sofra, the holding company which controls Telecom Argentina, the Argentinean government has warned that it may…
Following Friday’s news that an Argentinean appeals court has suspended the timetable by which Telecom Italia must sell off its 50% stake in Sofra, the holding company which controls Telecom Argentina, the Argentinean government has warned that it may ask its congress to cancel Telecom Argentina’s operating license.
Argentinean authorities initially ordered Telecom Italia to sell off its indirect stake in Telecom Argentina after it was decided that Telecom Italia majority owner Telco, controlled by Telefonica, had too much power on the Argentinean market, as Telefonica also operates Telefonica de Argentina in the country. Telecom Argentina and Telefonica de Argentina are the two main operators in Argentina. In early January, Telecom Italia was informed it had until February 25 to sell of its stake in Telecom Argentina, a decision which Telecom Italia shareholders instantly appealed. An appeals court late last week then suspend the timetable by which it must sell the stake, to which the Telecom Italia CEO added that he refused to be forced to sell the stake outright and that the telco will now review the benefit of selling or not selling, based on the offers.
The latest turn of events is that the Argentinean government has warned that it will ask its congress to cancel the licence altogether if an antitrust issue gets lodged with the courts. The country’s Planning Minister Julio De Vido stated on local TV that the government will terminate the licence and operating if necessary and that the government will not waver to do what needs to be done. The minister added that the sales process is already begun and offers have been received.
Telecom Italia is advised by Credit Suisse.
