2nd UPDATE: Telefonica, PT Sell Their 32.18% Meditel Stakes
September 01 2009 - 11:15AM
Dow Jones News
Spain's Telefonica SA (TEF) and Portugal Telecom SGPS SA (PT)
Tuesday agreed to sell their stakes in Morocco's Medi Telecom SA
for a total of EUR800 million, as they seek to focus on core
markets in Europe, Latin America and sub-Saharan Africa.
Telefonica and Portugal Telecom, which jointly operate Brazil's
leading mobile phone provider Vivo Participacoes SA (VIV), will
sell their respective 32.18% stakes to local Meditel shareholders
FinanceCom SA, RMA Watanya SA and Fipar Holding, which jointly will
pay EUR400 million to Telefonica and another EUR400 million to
Portugal Telecom.
Portugal Telecom will book an after-tax capital gain of EUR270
million from the sale of its stake, a company press official said.
Telefonica didn't disclose its own capital gain from the
transaction.
Portugal Telecom said despite Meditel being a company with high
growth potential, Portugal Telecom's strategic focus remains in
Brazil and sub-Saharan Africa.
A Telefonica press official said the Spanish telecommunications
giant wants to focus on core markets in Latin America, the U.K. and
Spain.
"Telefonica considers that it is the appropriate time to
crystallize the value created throughout this decade in Morocco,"
Telefonica said in a release. Both companies have been Meditel
shareholders for more than 10 years.
The transaction values Meditel at EUR1.62 billion, including
debt, Portugal Telecom said. No additional details were
disclosed.
At 1445 GMT, Telefonica shares were up 0.7% at EUR17.70, while
Portugal Telecom was up 1.7% at EUR7.33.
The transaction still requires clearance from Moroccan
telecommunications regulators. Telefonica expects the transaction
to be completed by the end of the year.
Company Web site: www.telefonica.com
-By Bernd Radowitz, Dow Jones Newswires, 34 913958120,
djmadrid@dowjones.com