Telefonica Pitching Telxius to Private Equity

After its planned IPO of Telxius didn’t generate sufficient interest last year, Telefonica remains interested in monetizing the division.  Reports over the weekend suggest that they are in the final stages of negotiations with a group of private equity companies that would see the sale of a 49% stake in Telxius.

Telefonica created Telxius one year ago this month, turning its submarine cable and tower assets into an infrastructure asset.  The idea was always tied to monetizing the asset as a means toward lowering Telefonica’s $50B debt load, a weight the company has been seeking to lighten for several years now.  Of course they have also been looking to monetize their UK wireless subsidiary O2, but have been slowed down by regulators who nixed a deal with Hutchison’s Three.

Supposedly on the other side of the deal that is on the table are the private equity players KKR, CVC, and Ardian, as well as the sovereign fund GIC.  Exactly which of those are working with which others isn’t clear yet.  Nevertheless, talks are said to be moving ahead quickly.  The report suggests that a deal could be in the works in March or even possibly by Telefonica’s earnings call in 9 days.

 

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Categories: Mergers and Acquisitions · Towers · Undersea cables