Telefónica agrees USD5.85 billion deal for BellSouth assets

8 Mar 2004

Spain’s Telefónica has reached an agreement to acquire BellSouth’s wireless assets in Latin America for USD5.85 billion in cash and debt in a deal which will make it the largest mobile operator in the region. As reported by PriMetrica last week, Telefónica, which already has substantial mobile operations in eight countries across the region, confirmed on Thursday that it was undertaking due diligence studies on the LatAm assets, as well as exploring the regulatory and accounting impact of any deal. The acquisition gives the Spanish-based telco access to six new markets – Colombia, Ecuador, Nicaragua, Panama, Uruguay and Venezuela – and with it 10.5 million new subscribers to boost its total in the region to 41 million. Atlanta-based BellSouth is thought to be selling the shareholdings to help pay its 40% share of the USD41 billion needed by its US subsidiary Cingular Wireless for AT&T Wireless. Telefónica was expected to face competition from rival bidders América Móvil and Telecom Italia, but this threat failed to materialise.