Telefónica sells 10% share of Telxius to Pontegadea fo €379m

30 July 2018 | Natalie Bannerman

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Telefónica is to sell a 9.99% share of its infrastructure company Telxius to Pontegadea, the real estate investment company of Amancio Ortega founder of fashion group Zara, for €378.8 million.

Telefónica is to sell a 9.99% share of its infrastructure company Telxius to Pontegadea, the real estate investment company of Amancio Ortega founder of fashion group Zara, for €378.8 million.

The transaction represents a price of €15.2 per share of Telxius and was structured by Telefónica’s subsidiary, Pontel Participaciones, which owns 60% of Telxius’ capital stock. Pontegadea owns 16.65% of Pontel with the remaining 83.35% belonging to Telefónica.

Once the sale is complete Telefónica will remain its majority stake and operational control in Telxius As a result the infrastructure division will continue to be consolidated into Telefónica’s accounts.

In addition, Telefónica, Pontegadea and Pontel have entered into a shareholders agreement to regulate the relationship between Telefónica and Pontegadea as shareholders in Pontel, in line with the existing shareholders agreement among Telefónica, Taurus Bidco and Telxius.

The news comes a part of the Telefónica Group’s asset portfolio management policy, which is focused on creating value, optimising the return on capital and strategic positioning. The deal also aligns itself with the company objective of organically reducing debt and strengthening the balance sheet in an increasingly cash flow scenario, allowing Telefónica to 'maintain a sustainable shareholder remuneration’.

Earlier this month Telefónica Spain (España) purchased 50MHz spectrum for €107.6 million enabling it to offer 5G services to its customers. The company obtained ten blocks of frequencies (50MHz in total) in the auction held by the Ministry of Economy and Business, meaning that the telco retains its priority position for frequencies for 5G.