The Spain-based company has hired Goldman Sachs and a range of other banks to advise on the sale, although the process is at a very early stage, according to the Financial Times.
A 70% stake sale of Telefónica Czech Republic has been in the offing for a long time and indicates an increasing trend of industry consolidation in Europe.
Telefónica is embarking on a strategy to divest its non-core assets in a bid to cut debt and help its cash flow.
The company has already moved to alter in European businesses this year, and expanded its presence in Germany through the acquisition of KPN’s E-Plus business.
It has also moved to increase its controlling stake in Telecom Italia’s shareholder pact.
The company has also moved to sell assets in Europe in a bid to keep control of its €49.8 billion net debt, and sold its Irish O2 operations to Hutchison Whampoa for approximately €790 million in June.
According to analysts, the Czech business will be sold at over six times its earnings, which is higher than the European average, despite local uncertainty over the country’s spectrum auction.
Czech mobile spectrum rates are among the highest in Europe, which could deter potential bidders, including smaller local players.
Reports suggest Russian player MTS could be interested in the business, in line with its investment strategy in new markets.
A range of private equity groups have also reportedly expressed an interest.
