Indebted Spanish telco Telefonica could spin-out its LatAm business next year.
Santiago Fernandez Valbuena, CEO of Telefonica Latin America, reportedly said that it wanted to explore its options and assess investor appetite. The comments were confirmed…
Indebted Spanish telco Telefonica could spin-out its LatAm business next year.
Santiago Fernandez Valbuena, CEO of Telefonica Latin America, reportedly said that it wanted to explore its options and assess investor appetite. The comments were confirmed by Telefonica’s CEO in a conference call today.
Telefonica has subsidiaries in Argentina, Brazil, Chile, Colombia, Ecuador, Mexico, Uruguay and Venezuela, and across smaller Central American countries.
According to a Reuters report Valbuena said there was no plan to float individual country’s units separately.
At the end of October Telefonica’s CFO, Angel Vila, suggested the possibility of splitting off Telefonica’s LatAm business to a separate domicile in a bid to protect the company from Spain’s continuing economic woes.
In its Q3 results today Telefonica revealed net debt of €56bn for the end of September and a provisional debt pile of €52.8bn should agreed disposals and restructuring close as planned, down from €58bn at the end of Q2.
However Telefonica is still short of its year-end net debt target. Analysts at Bernstein Research questioned whether floating units in LatAm was the answer.
“IPOing the better parts of Latin America could help to get there but we think that this would be complicated and time consuming, therefore highly unlikely before year end,” Bernstein said in a report.
Speaking on a conference call on the company’s results today, Telefonica CEO Cesar Alierta said the company is continuing to assess its options regarding the potential IPOs of its Latin American businesses next year, noting that the board has not yet made a decision.
“We do not need to do that transaction, but we may decide to do that” he said.
Alierta added that Telefonica has received expressions of interests for its assets, but did not elaborate.
