Telefonica moves into Latin America
8 March 2004, MADRID - Telefonica Moviles, the wireless unit of Spanish telecom giant Telefonica, said Monday it was buying the Latin American operations of US-based BellSouth Corp.
8 March 2004
MADRID - Telefonica Moviles, the wireless unit of Spanish telecom giant Telefonica, said Monday it was buying the Latin American operations of US-based BellSouth Corp.
Telefonica Moviles will acquire 100 percent of BellSouth's stake in operating companies in Argentina, Chile, Peru, Venezuela, Colombia, Ecuador, Uruguay, Guatemala, Nicaragua and Panama, making it the only cellular operator in all the region's key markets.
The announcement came from a report filed to the National Securities Market Commission (CNMV).
Telefonica said the price was based on a total enterprise value of EUR 4.87 billion.
The Spanish company will pay about EUR 3.5 billion in cash and assume some EUR 1.25 in debt.
The company said it did not expect any changes in the dividend.
Closing of the deal is subject to financial review and regulatory approval.
Telefonica will add 10.5 million new customers to its base, bringing the company's total number of customers to 41 million in 14 Latin American countries.
With the acquisition, Telefonica is expected to serve 40 percent of Spanish and Portuguese-speaking customers and 35 percent of all customers in Latin America.
It is a key geographic area where the company currently has a smaller share of the mobile phone market.
BellSouth's 10 Latin American units reported consolidated revenue in 2003 of more than EUR 2.08 billion, and earnings before interest, taxes, depreciation and other payments of EUR 722 million.
If BellSouth's wireless units had been owned by Telefonica Moviles, the Spanish company would have posted total revenue in Latin America of $5.4 billion and EBITDA of EUR 1.26 billion.
[Copyright EFE with Expatica]
Subject: Spanish news