Telefonica holds exclusive talks to sell its Mexican operations to Beyond ONE which operates Virgin Mobile Mexico because the company speeds up its withdrawal from unprofitable Latin American markets according to sources.
Analysts at Kepler Chevreux estimate that Telefonica’s Mexico business would receive a valuation of €520 million ($609 million) under the proposed deal. The company follows CEO Marc Murtra’s plan to concentrate operations in Spain, Germany, Britain and Brazil because these markets deliver better returns.
The ongoing discussions between the companies have not resulted in a definitive agreement. Both companies declined to comment.
Telefonica has completed the sale of its operations in Argentina, Uruguay, Chile and Ecuador. The company’s decision to exit Spanish-speaking Latin America stems from both structural difficulties and regulatory uncertainties in the region.
The proposed new antitrust commission presents a potential challenge to the Mexico deal because it may extend the approval process through changes to telecom transaction regulations. The new commission would obtain additional authority which creates doubts about the timing of deals.
Beyond ONE bought Virgin Mobile Latin America in 2023 while pursuing further market expansion. The company receives funding from Dubai-based investors who want to build a digital service network across Latin America.