Telefónica has requested that Colombia’s Superintendency of Industry and Commerce evaluate its unit, Coltel, ahead of a potential sale to Millicom as part of its ongoing divestment plan in Latin America.
Coltel is valued at around US$400 million, and at the end of July, Telefónica signed a non-binding agreement with Millicom to explore a possible deal.
In a statement to Spain’s National Securities Market Commission in July last year, Telefónica said any potential transaction would be subject to regulatory approvals and “may involve the sale of the Telefónica Group’s shares in Telefónica Colombia.”
This follows reports that Telefónica is also seeking to exit Argentina. The company is pursuing a divestment strategy to reduce its large debt burden and strengthen its balance sheet.
Latin America, like other developing markets, operates on low margins and faces intense competition. Telefónica is shifting its focus to more profitable core markets, including Spain, Brazil, Germany, and the UK.
