Argentina’s President Milei slams Spanish operator group’s sale of Argentinian opco while Telefónica’s new Chair talks about building European resilience in uncertain times
Telefónica has completed the the sale of its Argentine subsidiary, leaving the buyer to face any fallout from the regulatory process and the fury of the country’s President.
Telefónica sold all the shares it holds in Telefónica Móviles Argentina, representing 99.999625% of its share capital, and all the share capital of its operation in Argentina to Telecom Argentina for €1.19 billion in cash. This is considerably above the €800 million value that analysts had estimated. Telecom Argentina is controlled by Cablevisión Holding and the Grupo Clarín.
To put the size of this deal in some context, the entire Telefónica Group has a market cap of about €24 billion and €29 billion of debt.
Presidential preference
El Economista reports that Javier Milei, President of Argentina, cannot overturn the sale although he had strongly objected to the transaction, arguing it reduced the amount of competition and choice in the Argentinian market. Now any if Milei attempts to leverage the regulatory regime to slow or stop the sale, the buyer will have to settle the matter in court or through divestments, El Economista says.
He issued an official statement on hearing of the deal, saying the transaction will go through the National Communications Entity (ENACOM) and the National Commission for the Defense of Competition (CNCD) “to evaluate whether this operation does not constitute the formation of a monopoly.”
In the same statement, the Argentine government pointed out that the transaction will leave approximately 70% of telecoms services in the hands of a single commercial group.
Faster execution
Earlier this month, shareholders, seemingly led by the Spanish government, ousted the long-standing CEO and Chair Jose Maria Alvarez-Pallete, replacing him with British-born Marc Murtra (pictured), who has a long affiliations with state-owned organisations in Spain. The Spanish government holds a 10% stake in Telefonica, making it the group’s biggest shareholder. Murtra joined from the Spanish state-backed defence company, Indra Sistemas, where he was President from 2021 to 2025.
Alvarez-Pallete had said the group would exit Latin America, apart from Brazil, in a strategy announcement in 2019, which rolled into its next five year strategy plan. Murta’s pace in executing that plan since taking office has been breathtaking. While Argentina’s President issued angry missives, Murta was busy giving his first interview at the head of Telefonica to the Financial Times.
Sticking to your knitting
Murtra told the FT that he wants to help boost Europe’s “strategic autonomy” through telecoms mergers and continent-wide consolidation. This is everything the European Commission has fought against since the liberalisation of telecoms started in the 1980s in the name of competition and choice for consumers.
Murtra compared the telecoms market to the defence industry before Russia invaded Ukraine in that its importance was not sufficiently appreciated. One might add the defence sector has become far more appreciated since the US’ Vice-President’s speech in Munich a couple of weeks ago. Regardless, Murtra is making the point that Europeans’ know-how is precious but must be fostered, and could counterbalance Big Tech. “My view is that while calamities are inevitable, decadence is not,” he was cited saying.
He added that a strategic review of Telefonica would be completed in the second half of 2025 but he would not seek to compete with US Big Techco in areas outside telecoms: “We’re going to focus on what we know how to do better than anybody else,” he added.
As the late and much-missed Maev Sullivan used to say, “Telephone companies should stick to their knitting”.