Telefónica sells its enterprise in Mexico for 390 million euros with robust capital losses | Economy | EUROtoday

Telefónica has reached a binding settlement for the sale of all of its capital in its Mexican subsidiary to the Melisa Acquisition consortium, made up of the know-how firm Oxio and the funding fund Newfoundland Capital Management. The operation, valued at 450 million {dollars} (roughly 390 million euros), marks the definitive exit of the Spanish operator from the Mexican market and consolidates its divestment technique in Latin America. Although the operator has not detailed the monetary particulars of the operation, the sale will report robust capital losses on the steadiness sheet, as has already occurred within the exit of the remainder of the Latin American subsidiaries, which brought on web losses of 4,318 million euros in 2025, the second largest in its historical past.

According to the related truth despatched to the National Securities Market Commission (CNMV) within the early hours of this Wednesday, the transaction is executed via Telefónica Hispanoamérica, a unit that brings collectively the group’s belongings within the area. The settlement contemplates the switch of 100% of the shares of the businesses Pegaso PCS and Celular de Telefonía, the authorized entities that function below the corporate’s trademark in Mexican territory.

The sale value agreed below the idea of agency worth is topic to customary web debt and dealing capital changes at closing. The completion of the switch is topic to the approval of the Mexican regulatory authorities, primarily the Federal Telecommunications Institute (IFT), in addition to compliance with the usual contractual situations in one of these company transactions.

With this transfer, the multinational chaired by Marc Murtra reduces its presence on the American continent to only two markets: Brazil, thought-about a strategic and cash-generating pillar for the group, and Venezuela, the place it maintains operations below a differentiated administration mannequin. This divestment in Mexico marks essentially the most important step so far in administration’s plan to simplify the steadiness sheet and focus capital assets on Spain, Germany, the United Kingdom and Brazil.

The sale to Melisa Acquisition represents the entry of a brand new participant with a monetary and technological profile within the cellular telecommunications sector in Mexico. The consortium is led by Oxio, a know-how platform specialised in community virtualization and connectivity options, along with Newfoundland Capital Management, an asset administration agency with expertise in infrastructure and rising markets.

Sources near the operation indicated that Melisa Acquisition’s curiosity lies in Telefónica’s present buyer base in Mexico and within the subsidiary’s working mannequin. Telefónica México had already remodeled its enterprise construction lately via a strategic settlement with AT&T for using its last-mile community infrastructure, which allowed the Spanish agency to cut back its working and spectrum upkeep prices, primarily working as a large-scale digital cellular operator.

The $450 million valuation displays this asset-light construction (asset-light). According to trade analysts, the a number of utilized to the transaction is aligned with latest valuations of connectivity providers corporations that wouldn’t have their very own bodily entry community infrastructure, however preserve a related market share within the pay as you go and postpaid phase.

Accounting losses

The exit from Mexico is a part of the roadmap outlined by Telefónica’s board of administrators to speed up the discount of monetary leverage. The firm has repeatedly said that its precedence is the allocation of capital in markets that provide regulatory safety and the potential for sustained long-term development. However, the large investments within the nation resulting from competitors with América Móvil will imply heavy accounting losses that can be mirrored within the accounts of the Spanish multinational, as has occurred with the sale of the remainder of the American subsidiaries (Argentina, Chile, Peru, Colombia, Uruguay and Central America).

Marc Murtra’s administration has intensified the asset rotation course of beginning with Telefónica Hispam as an impartial unit. The unique goal of this division was to hunt alliances and mergers nevertheless it has led to complete gross sales to restrict the group’s publicity to trade volatility and macroeconomic dangers within the area. After earlier operations in Central America and the sale in the remainder of South American international locations, the divestment in Mexico is the milestone that just about completes the regional withdrawal.

Telefónica has confused in its assertion that this choice will enable the corporate to strengthen its enterprise construction in Europe. The Spanish market continues to be the principle generator of Ebitda for the group, whereas the operations in Germany and the United Kingdom (via the three way partnership VMO2) are key to the deployment of 5G and fiber optic networks.

Stay in Venezuela

The choice to keep up solely operations in Brazil and Venezuela responds to reverse dynamics. In Brazil, Telefónica (below the Vivo model) considers the strategic market together with Spain, the United Kingdom and Germany. As for Venezuela, the operator maintains a dominant place within the native market. Although the monetary contribution to the consolidated group is proscribed, with robust web losses, resulting from trade restrictions and the nation’s financial state of affairs, the operation generates working money flows which are reinvested within the native community itself. In addition, the group needed to cope with the nation’s authoritarian regime below the presidency of Nicolás Maduro, now imprisoned within the United States, which pressured it to allocate an funding of 500 million {dollars} to the extension of the 5G community with no assure of return.

The telecommunications market in Mexico now faces a brand new configuration after the departure of a historic competitor. Telefónica entered Mexico in 2000 after buying a number of native operators, together with Pegaso. For greater than twenty years, the corporate competed below unequal situations to be the principle various to Telcel (América Móvil). owned by billionaire Carlos Slim who consolidated his fortune within the privatization of the Mexican phone monopoly Telmex greater than three many years in the past and has since dominated the market with the announcement of nationwide regulators.

However, the excessive prices of radio spectrum in Mexico and the robust focus of the market made it troublesome to make capital-intensive investments worthwhile. This state of affairs led the corporate to return the spectrum it owned and migrate its site visitors to the AT&T community in 2019, a transfer that anticipated the sale reported right now.

For customers in Mexico, it’s anticipated that the change in possession is not going to end in an instantaneous interruption of providers. Melisa Acquisition has indicated that it intends to make the most of Oxio’s technological capabilities to modernize the industrial provide and deepen the combination of digital providers, sustaining present wholesale agreements to ensure nationwide protection.

From an accounting standpoint, the €389 million transaction will contribute to the online discount of Telefónica’s debt, which has been a precedence for credit standing companies. Although the determine is decrease in comparison with different infrastructure operations (such because the sale of Telxius towers), the actual worth for Telefónica lies within the elimination of operational liabilities and the simplification of its company group chart.

The market has reacted stably to the announcement. Analysts agree that the operation is in step with the “active portfolio management” discourse that the corporate has maintained in its newest earnings shows. The exit from a low-margin and excessive regulatory complexity market such because the Mexican one is seen as a essential measure to enhance the group’s free money movement profile.

The operation can be topic to assessment by the CNMV and the competent our bodies in Mexico throughout the coming months. If the anticipated deadlines are met, Telefónica expects to definitively shut the switch of shares earlier than the tip of the third quarter of 2026. With this closure, Telefónica’s international presence map can be decreased to its 4 core markets and the aforementioned residual or strategic stakes, culminating a structural transformation course of that has lasted greater than 5 years.