Telefónica exits Ecuador with $380m sale to Millicom as LATAM divestments accelerate

June 16, 2025 09:45 AM

Telefónica has continued its withdrawal from Latin America with the sale of its Ecuadorian unit, Otecel (operating under the Movistar brand), to Millicom for US$380 million.

Telefónica is attempting to streamline operations and shed non-core assets in the region.

Millicom, which operates under the Tigo brand in several Latin American markets, now holds 100% ownership of Movistar Ecuador.

The acquisition places the company in a stronger competitive position against local rivals América Móvil’s Claro and state-owned CNT, which together serve Ecuador’s 17.8 million mobile users. Pre-deal estimates indicated Claro controlled 52% of the mobile market, Telefónica 31%, and CNT the remaining 17%.

This deal follows a wave of Telefónica divestments. Earlier this year, the Spanish telecoms giant offloaded its Peruvian operations to Argentina’s Integra Tec International for just over US$1 million following the unit's bankruptcy filing.

That sale contributed to an accounting loss of approximately US$1.9 billion in Q1 2025, largely due to asset write-downs in Peru and Argentina.

In Colombia, Telefónica is also scaling back. It recently agreed to sell a 67.5% stake in its Colombian subsidiary Coltel (Movistar Colombia) to Millicom for €368 million. Millicom has expressed interest in acquiring the remaining 32.5% held by the Colombian government and other investors, a move that would grant it full control of the operator.

Millicom CEO Marcelo Benítez called the acquisition “a pivotal moment” that strengthens the group’s regional footprint. “This deal enhances our position in Colombia and reflects our commitment to expanding connectivity, accelerating digital transformation, and supporting the country’s growth,” he said.

Since announcing its LATAM divestment strategy in 2019, Telefónica has exited Argentina, Uruguay, and now Ecuador, aiming to reduce exposure to volatile markets and refocus on core European operations. The $1.25 billion sale of Telefónica Argentina to Telecom Argentina is currently under regulatory review.