Spanish operator Jazztel has confirmed recent press reports that it has begun discussions over the possible acquisition of a stake in TeliaSonera’s Spanish mobile unit Yoigo. In a statement to Spain's market regulator CNMV, Jazztel said the talks were still “in an initial phase” and would not necessarily be followed by an offer. The statement adds that Jazztel would also seek to acquire the remaining shareholders’ stake if required. The confirmation follows a report in Bloomberg that Jazztel was talking with advisers about a potential transaction to be financed with its own shares. However, the report added that the operator hadn’t yet decided whether to proceed with an offer and wanted to avoid a bidding war with other interested parties, such as Orange Spain.
In July, El Economista revealed that TeliaSonera had begun sounding out the interest of Orange Spain and Jazztel in acquiring its Spanish unit. Commenting on Yoigo’s 20 percent second-quarter drop in sales, TeliaSonera CEO Johan Dennelind said the unit remained “sub-scale” and that “we are reviewing our future presence in the Spanish market”. Like other mobile-only operators, Yoigo has struggled to compete in a country in which deeply discounted all-inclusive bundles of fixed and mobile phone, television and broadband services continue to dominate.
Two months ago sources told El Economista that TeliaSonera would be satisfied with around EUR 700 million for Yoigo, some nine times the operator’s EBITDA for 2013, but Bloomberg’s sources say offers may value Yoigo at less than EUR 500 million.
In a regulatory statement TeliaSonera also confirmed that it is in talks with Jazztel as well as other parties as part of a review of its future presence in the Spanish market.
