In December 2023, Spain’s economic ministry had announced plans to acquire a stake in Telefonica
The Spanish government acquired a 3% stake in telecom operator Telefonica through a state holding company, with the main aim of attempting to balance the influence of Saudi telco stc in the Spanish company.
Spanish state-run company Sociedad Estatal de Participaciones Industriales (SEPI) acquired a total of 175 million shares, worth around €698 million ($756 million), in the first step of a move to acquire a stake of up to 10% in the operator.
“The entry of the SEPI, a shareholder with a long-term commitment, will provide Telefonica with greater shareholder stability to achieve its objectives, contributing to safeguarding the strategic capabilities of a company that is strategic for [Spain’s] national interests,” SEPI said in a statement.
In December 2023, Spain’s economic ministry had announced plans to acquire a stake in Telefonica. It is the first time that the Spanish government has purchased a stake in Telefonica since it was fully privatized in 1997.
In September, Saudi Telecom Company has purchased a 9.9% interest in Telefónica for €2.1 billion to further its growth ambitions outside of Saudi Arabia. The stake, said the company, is comprised of 4.9% of Telefónica’s shares, as well as “financial instruments giving economic exposure to a further 5% of Telefónica’s share capital.”
STC said it plans to convert those instruments into shares but noted that it requires official approval to do so. Government authorization is needed for any foreign investor taking a stake of 5% or more in certain “strategic” defense companies, it explained, adding that Telefónica’s businesses related to national security and cyber defense puts it in that category.
The Saudi carrier has said it does not intend to “acquire control or a majority stake” in the Telefónica.
Following the acquisition by stc, the Spanish government said it would fully examine stc’s acquisition before giving any approval to the deal.