Telefónica nearing $700m sale of Chile data centre

23 April 2019 | Natalie Bannerman

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Telefónica is reportedly close to the sale of its Chile data centre as it reviews offers from interested parties, submitted a few weeks ago.

According to Expansión, the Spanish business newspaper, and sources close to the matter, the company is set to receive up to $700 million for the facility, which will go towards debt reduction.

The news comes almost a year after Bloomberg reported that the company had hired financial advisors and was preparing to accept offers from potential buyers, which include data centre specialist firms, infrastructure and private equity firms.

The news comes as no surprise, as Telefónica has been selling off a number of its assets over the last few months. In February, the company entered into an agreement with Millicom for the sale of partial and whole parts of Telefónica Costa Rica, Panama and Nicaragua. Back in January, Telefónica subsidiary, Telefónica Centroamérica Inversiones, sold its business units in Guatemala and El Salvador to América Móvil for €570 million.

At the time, the decision to sell is based on Telefónica’s goal organically reducing its debt and strengthening its balance sheet “in a growing cash flow scenario” enabling it to deliver an attractive remuneration package to its shareholders.

The 5,000-sq.m Chilan facility was launched in 2016 in the town of Paine, just over 20 miles from Santiago. Telefónica has 25 data centre facilities spread across United States, Europe and Latin America. Its other data centres in the region includes Mexico, Central America, Ecuador, Colombia, Venezuela, Peru, Brazil, Uruguay and Argentina.

Back in February, Telefónica partnered with Facebook and IDB Invest and CAF (Development Bank of Latin America) to launch Internet para Todos (IpT) Peru to expand internet connectivity in Latin America.