Telefonica may sell 20% stake in German unit, report says

6 Jun 2012

Spanish telecoms group Telefonica is considering listing a 20% stake in Telefonica Germany (O2), one week after saying it was preparing for an initial public offering (IPO) of the German unit and exploring potential listings of Latin American assets, Bloomberg cites three people familiar with the matter as saying. The unidentified sources said that Telefonica, which is struggling to cut its debt burden amid falling revenue and profit in its domestic market, is looking to raise as much as EUR2 billion (USD2.49 billion) from the sale. While an IPO for Telefonica Germany is the preferred option, a merger with E-Plus, the German wireless business of the Netherlands’ KPN Telecom, remains an alternative, the report adds. The Dutch firm and Telefonica are reportedly evaluating a variety of options, including a combination of O2 Germany and E-Plus and then selling a stake in an entity as part of an IPO, people familiar with the matter have said. Last week KPN announced that it was launching a full strategic review of E-Plus, following its rejection of an unsolicited EUR2.6 billion offer for an increased stake in KPN from America Movil (AM), the Mexican group owned by Carlos Slim.

Germany, E-Plus Group, Telefonica, Telefonica Deutschland Holding