Deal could raise as much as £598 million according to a report in the Financial Times, with Three owner Hutchinson Whampoa emerging as a potential buyer
Telefónica is considering a sale or merger of its Irish operation as it looks to reduce its debt by €4 billion to €47 billion before the end of the year.
This is according to a report in the Financial Times which said that a sale of the Irish operator could raise as much as €700 million (£598 million) for the Spanish telecoms firm.
The report, which refers to a source with knowledge of the situation, says Telefónica has received “expressions of interest” in O2 Ireland, with the group willing to consider offers.
It is claimed that Hong Kong-based Hutchison Whampoa, which owns mobile operator rival Three Ireland, is an interested party although there are doubts over whether such in-market consolidation would be allowed by regulators.
Telefónica and Hutchison Whampoa declined to comment.
Telefónica stated in its Q1 results presentation last month that it would continue to pursue asset sales as part of its debt reduction target.
The group’s chief financial officer Ángel Vilá said it was “actively” managing its portfolio and said it could reduce debt “inorganically” – indicating asset sales – as well as through the use of free cash flow.
Vilá wouldn’t be drawn on any potential deal, but did say that Ireland would “benefit from in-market consolidation.”
“We don’t want to create uncomfortable situations in our operations,” he added. “We are not in an expansion mode but, yes, we can be in a strengthening mode in some of the markets where we operate. Some of these markets could benefit from in-market consolidation.”