Telefonica's Strategic Shift: Mexican Business on the Market

Telefonica is in exclusive talks to sell its Mexican operations to Beyond ONE. Facing profitability challenges in Latin America, the Spanish telecom giant is refocusing on its core European markets. Regulatory uncertainties in Mexico could delay the deal, valued at approximately 520 million euros.

Spanish telecom giant Telefonica is actively negotiating the sale of its Mexican division to Dubai-based Beyond ONE, owner of Virgin Mobile Mexico. Insiders familiar with the matter confirmed the discussions, underscoring Telefonica's strategic pivot to concentrate on more lucrative markets in Europe, under CEO Marc Murtra's leadership.

The company seeks to streamline its operations amidst financial pressures in Latin America, where returns have been insufficient. Beyond ONE, which expanded its footprint this year by acquiring Virgin Mobile Latin America, represents a potential buyer, but regulatory challenges linger with the proposed creation of a new Mexican antitrust body that could complicate approvals.

Telefonica's divestment trend includes agreeing to major transactions, such as selling its Argentine unit and planning sales in Chile, Ecuador, and Uruguay to refocus on core markets in Brazil, Britain, Germany, and Spain, aiming to bolster profitability and operational focus.

(With inputs from agencies.)