Telecommunications giant Vodafone Group is ready to sell more than 50% of the shares of its Spanish division to Zegona Communications for more than 5 billion euros. The agreement is at the stage of finalizing the details and may be officially announced in the coming days. London-based Zegona beat out other contenders, including private equity firm RRJ Capital.
This agreement is expected at a time when the telecommunications market of Spain, already known for its high competitiveness in Europe, is preparing for serious transformations. Orange SA and Masmovil Ibercom SA are awaiting regulatory approval for their merger, which would make them the biggest operator in Spain, overtaking Telefonica SA.
The Spain deal became the subject of Vodafone's interest more than a year ago, but the company's previous CEO, Nick Reid, was forced to step aside as his rivals struck merger deals, leaving Vodafone on the sidelines. After a series of setbacks and declining profits, the new CEO, Margherita Della Valle, revised the strategy and preferred to focus on Vodafone's "cluster" of smaller European companies.
