Telefonica believes that its exit from Latin America improves its position to undertake consolidation operations in the telecommunications sector in Europe
In sum – what you need to know:
Telefónica exits continue – The Spanish operator is in exclusive talks to sell Movistar Mexico, following sales in Argentina, Peru, and Uruguay.
Beyond ONE expands again – The Dubai-based owner of Virgin Mobile Latin America eyes Movistar to grow its Mexican presence.
Regulatory hurdles loom – A new antitrust commission in Mexico may complicate or delay the sale process.
Spanish telco Telefónica is reportedly in exclusive talks to sell its Mexican mobile business to Beyond ONE, the Dubai-based company that owns Virgin Mobile Latin America.
According to a Reuters report citing three unnamed sources, the Spanish telecom group is accelerating efforts to exit several regional markets under its new strategic plan. Talks with Beyond ONE over Movistar Mexico are ongoing, and while a final agreement has not been reached, both parties are said to be engaged in detailed discussions.
Beyond ONE has been actively expanding in the region. In 2023, it acquired Virgin Mobile Latin America, which includes operations in Mexico, shortly after also buying Virgin Mobile’s businesses in the Middle East and Africa.
One of the sources said the creation of a new antitrust commission — proposed by Mexico— could delay any telecommunications deal, because it would create uncertainty about obtaining regulatory approvals. The proposed body would have power over telecommunications companies.
Telefonica’s decision to potentially sell its Mexican unit aligns with broader divestment efforts across Latin America. It has already agreed to sell its operations in Argentina to Telecom Argentina and has closed deals involving its units in Ecuador, Uruguay, Peru, and Colombia. Telefónica’s chairman, Marc Murtra, believes that the company’s exit from Latin America improves its position to undertake consolidation operations in the telecommunications sector in Europe, where three of its four main markets are concentrated: Spain, Germany, and the U.K.
Financial consultancy Kepler Cheuvreux estimated in June that Telefonica’s Mexican business could be valued at approximately €520 million ($609 million).
Virgin Mobile, meanwhile, held 7.78% of Mexico’s MVNO market in 2023, according to data from Mexican regulator IFT.
Last month, Telefonica and Millicom International Cellular confirmed they had reached a definitive agreement under which the latter will acquire 100% of Telefónica’s operations in Ecuador, in a transaction valued at $380 million.
Millicom said that the acquisition of Movistar in Ecuador strengthens its position in South America and deepens its geographic diversification. With the addition of Ecuador — a stable, dollarized economy with a positive macroeconomic outlook — Millicom bolsters its regional scale, operating cash flow resilience and long-term growth prospects, the telco said.
In May, Telefonica reached an agreement to sell all of the shares in its Uruguayan subsidiary to the Millicom Group for a total of $440 million.
The transaction is still subject to certain closing conditions, including the approval of the corresponding regulatory authorizations.
Telefónica, which also operates under the Movistar brand in Uruguay, is the country’s second-largest mobile operator, with nearly 29% of the mobile market by March 2025.
In March, Telefónica had also finalized an agreement to sell 67.5% of its Colombian unit Coltel— which it operates under the Movistar brand — to Millicom for approximately approximately $416 million.
In addition to acquiring Telefónica’s stake, Millicom had announced an offer to purchase the remaining 32.5% of Coltel, currently owned by the Colombian government and other investors. If successful, Millicom would gain full control of the company.
In February, Telefonica announced the sale of its Argentine subsidiary to rival Telecom Argentina for $1.245 billion as another step in the company’s efforts to reduce its footprint in Latin America.
The Argentine government initially announced that it will investigate the acquisition to determine whether it creates a monopoly. The Office of the President released a statement warning that “70% of telecommunications services would be controlled by a single economic group, creating a monopoly formed thanks to decades of state benefits.”
In March, the Argentine authorities announced a preventive measure seeking to suspend Telecom’s acquisition of Telefónica. The government said that the suspension is based on the recommendation of the National Commission for the Defense of Competition, which indicated that “the merger of both companies would significantly increase their market share.”
