Telefonica says Mexican arm could be candidate for flotation
By Leila Abboud
BARCELONA Nov 11 (Reuters) - Spain's Telefonica is committed to staying in the Mexican market and sees its subsidiary there as an attractive candidate for a share market flotation, the group's finance chief said on Wednesday.
"We have been in Mexico for so many years, investing so much money, and now that it's starting to fly and make money, it would be strange for us to leave now," Angel Vila said at the annual Morgan Stanley European Technology, Media and Telecom investor conference in Barcelona.
"It's a growing business that could be attractive for an initial public offering," he added.
Telefonica has a market share of about 20 per cent in Mexico but has long trailed billionaire Carlos Slim's America Movil which has around 70 percent. It also faces a new challenge from AT&T, which bought third-placed Iusacell last year.
Telefonica, led by Cesar Alierta for the past 15 years, has been transformed since the economic crisis forced it to focus on fewer but bigger foreign markets, such as Germany and Brazil, and cut its debt and gearing with the help of a series of asset sales, the most recent being its 10.25 billion-pound ($15.6 billion) deal to sell UK mobile network operator, 02, to rival operator Hutchison.
That deal is now being vetted by the European competition regulators with a decision expected by mid-April next year.
The prospects for winning approval were thrown into doubt two months ago when the regulators blocked a merger in Denmark over concerns that consumers would face higher prices if the number of network operators was reduced.
Vila said he remained confident that the sale of 02 UK would proceed but Telefonica would have other options if it failed, including a sale to another party or a share market flotation. Continuación...