The Government of Javier Milei has suspended in a “preventive” way the sale of Argentine Telecom Telecom (controlled by the Clarín and Fintech group), claiming risks of monopolistic concentration. However, Telefónica has already charged 1,245 million dollars (about 1,190 million euros) and considers the closed and irrevocable operation.
The problem is not in your hands now, but in that of your buyers.
Why is it important. The operation represents a strategic divestment for Telefónica, which seeks to reduce its exposure in Latin America to focus on its priority markets: Spain, Brazil, Germany and the United Kingdom.
- Argentina meant only 3% of group’s revenues and generated negative operational results (-199 million euros in 2023).
Between the lines. The blockade has a strong political component: Milei maintains an open confrontation with the Clarín Group, owner of 40% of Telecom Argentina and owner of the country of greater circulation in the country and several influential media.
The Argentine President even fixed in his X account a message accusing Clarín of “hosting the government with lies.”
The contrast. Milei’s position is contradictory with his ultraliberal ideology. In February, during a speech in Washington, he said that “monopolies are not bad, unless they are armed by the State.” Now it uses precisely antitrust arguments to block an operation between private companies.
Yes, but. Argentine legislation, unlike the Spanish or European, contemplates only one control ex post of business operations. This means that conditions or restrictions can only be imposed on the buyer, not the seller, and only after closing the transaction.
In figures. According to the Argentine government, the merger would create a telecommunications giant that it would concentrate:
- 61% of the mobile phone market.
- 69% of fixed telephony.
- Up to 80% of the residential Internet service in some areas.
And now what. Telefónica goes out with the clean jacket of this Barrizal. If the Argentine authorities confirm the dominant position, the only one affected would be Telecom Argentina, which could be forced to sell assets at lower prices than they would put in normal conditions. The objective, reduce its market share.
The operation is part of Telefónica’s strategy to disinvest in Latin America, where businesses represent 13% of the Ebitda with lower margins (19.4% compared to 32.1% of the group).
- This operation seems clearly advantageous for Telefónica, which can now reinvest the funds achieved in businesses with the greatest growth potential, such as Telefónica Tech or as its position in the United Kingdom. Or continue reducing your debt.
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