Telefónica Sells Ecuador Subsidiary to Millicom for $380 Million
Table of Contents
- Telefónica Sells Ecuador Subsidiary to Millicom for $380 Million
- Millicom acquires Telefónica Ecuador: A Strategic Move
- Ecuador’s Mobile Market Landscape
- Regulatory Approval and Millicom’s Expansion Strategy
- Telefónica’s Strategic Shift in Latin America
- Evergreen Insights: the Evolving Telecommunications Landscape in Latin America
- Frequently Asked Questions About the Telefónica Ecuador Sale
Telefónica has reached an agreement to sell 100% of its Telefónica Ecuador stake to the Luxembourg-based Millicom group for $380 million, according to a recent statement to the National Securities Market Commission (CNMV). The sale of Telefónica Ecuador, which operates under the Movistar brand, marks another step in Telefónica’s strategy to reduce its exposure to Latin America [1].
Millicom acquires Telefónica Ecuador: A Strategic Move
The transaction, subject to customary adjustments and regulatory approvals, aligns with telefónica’s broader policy of streamlining its operations in Latin america.this sale represents the fifth divestiture by the company, led by Marc Murtra, in the American Subcontinent, following the completed sales of subsidiaries in peru and Argentina, and pending approvals for Colombia and Uruguay. After this transaction, Telefónica’s presence in Latin America will be limited to Mexico, Chile, Venezuela, and Brazil, with Brazil considered a strategic market alongside Spain, the United Kingdom, and Germany.
Did You Know? Telefónica Ecuador holds approximately 28% of the mobile market share in Ecuador, serving around five million customers as of March 2025.
Millicom, while based in Luxembourg, has a significant presence in the Latin American telecommunications sector through its Tigo brand. The company previously acquired Telefónica’s subsidiaries in Uruguay for $440 million and Colombia Telecomunicaciones (Coltel) for $400 million. In 2019, Millicom also acquired subsidiaries in Costa Rica, Panama, and Nicaragua for $1.65 billion [2].
Ecuador’s Mobile Market Landscape
Telefónica Ecuador currently stands as the second-largest mobile operator in the country, holding a market share of approximately 28% and serving around five million customers as of March 2025. América Móvil, controlled by Carlos Slim, leads the market with 54%, followed by the local operator CNT with 18%.
Pro Tip: Keep an eye on regulatory approvals, as they can significantly impact the timeline and final terms of the acquisition.
Regulatory Approval and Millicom’s Expansion Strategy
The sale of Telefónica Ecuador is contingent upon approval from the Ecuadorian regulatory authorities,which have the power to impose conditions or even block the transaction if it is deemed to violate free competition laws. Though, given that Millicom does not currently operate in Ecuador, regulatory hurdles are expected to be minimal.
Millicom’s CEO,Marcelo Benítez,emphasized that the acquisition reflects the company’s long-term confidence in Latin America. He stated that Ecuador’s dynamic and growing digital market, coupled with a stable and dollarized economy, makes it an ideal fit for Millicom’s strategy. The company aims to strengthen its innovation, diversification, and long-term value creation by expanding its presence in South America.
Telefónica’s Strategic Shift in Latin America
This sale is part of a series of strategic moves by Telefónica to optimize its portfolio and focus on key markets.In February 2025, Telefónica sold its Argentinian subsidiary to a group of investors controlled by the Clarín media group and the Fintech fund for approximately 1.19 billion euros. Additionally, in april 2025, the company announced the sale of its Peruvian subsidiary to the Argentine firm Integra Tecc International for 900,000 euros, including the assumption of 1.2 billion euros in debt.
| Transaction | Subsidiary | Buyer | Value |
|---|---|---|---|
| Completed | Argentina | Clarín media group & Fintech fund | €1.19 Billion |
| Completed | peru | Integra Tecc International | €900,000 (plus €1.2B debt assumption) |
| pending | Ecuador | Millicom | $380 Million |
| Previously | Uruguay | Millicom | $440 Million |
| Previously | Colombia (Coltel) | Millicom | $400 Million |
millicom, on the other hand, has indicated in a statement that this operation “significantly reinforces the regional presence and commercial scope of Millicom, laying the foundations for innovation, digital inclusion and long -term sustained growth.” “The telecommunications sector of Ecuador, backed by a constant expansion of mobile and broadband services and a compromised regulatory habitat, offers an attractive platform for Millicom to impulse the digital transformation,” the company added.
Evergreen Insights: the Evolving Telecommunications Landscape in Latin America
The telecommunications market in Latin America is undergoing significant changes, driven by increasing demand for mobile and broadband services.Companies like Telefónica are strategically re-evaluating their presence in the region, focusing on core markets and divesting from others to optimize their portfolios. This trend is creating opportunities for companies like Millicom to expand their footprint and capitalize on the growing digital economy in Latin America.
The sale of Telefónica Ecuador to Millicom reflects a broader trend of consolidation and strategic realignment within the Latin American telecommunications industry.As the demand for digital services continues to grow, companies are seeking to optimize their operations and focus on markets where they can achieve sustainable growth and profitability.
Frequently Asked Questions About the Telefónica Ecuador Sale
What does this sale mean for Movistar customers in Ecuador?
The sale is not expected to have an immediate impact on Movistar customers in Ecuador.Millicom is committed to continuing to provide high-quality services and expanding its offerings in the country.
How will this acquisition affect competition in the Ecuadorian mobile market?
The acquisition is expected to increase competition in the Ecuadorian mobile market, as Millicom brings its expertise and resources to the country. This could lead to lower prices and improved services for consumers.
What are the long-term implications of Telefónica’s reduced presence in Latin America?
Telefónica’s reduced presence in Latin America reflects a strategic shift towards focusing on core markets and optimizing its portfolio. This could lead to increased investment and innovation in its key markets, while also allowing other companies to capitalize on opportunities in latin America.
What are your thoughts on this acquisition? How do you see the telecommunications landscape evolving in Latin America? Share your comments below!
