Telefonica of Spain, which currently owns 70.8% of its Czech subsidiary Telefonica O2 Czech Republic, has agreed to sell a 65.9% stake in the company to local investment firm PPF Group. Under the deal, announced today on its web site, the total cash consideration for the operation is EUR2.467 billion (USD3.404 billion), with EUR2.063 billion in cash payable upon completion of the transaction and a deferred payment of EUR404 million over a period of four years. Before transferring the shares, Telefonica will receive an additional payment of EUR260 million euros in November for the dividend declared. Although it is expected that PPF will launch a mandatory tender offer for the remaining capital, Telefonica will maintain a stake of 4.9% in Telefonica O2 CR, and will remain as an industrial and commercial partner for a period of four years. The Spanish firm may dispose of its shares subject to certain conditions once the mandatory offer is over. Under the deal, which also includes its operations in Slovakia, the new owner will have rights to use the O2 branding for another four years. The sale is subject to regulatory approval by the European Commission (EC).