Information  X 
Enter a valid email address

Telefonica SA (0TDE)

  Print      Mail a friend       Annual reports

Monday 02 April, 2012

Telefonica SA

Colombia Agreement

RNS Number : 5673A
Telefonica SA
02 April 2012




TELEFÓNICA, S.A. as provided in article 82 of the Spanish Stock Market Act (Ley del Mercado de Valores), hereby reports the following






Telefónica, S.A. ("Telefónica") hereby reports that Telefónica Móviles Colombia, S.A.  (a company fully owned by Telefónica), the Colombian government (hereinafter "the Government"), and Colombia Telecomunicaciones, S.A. ESP (a company 52% owned by Telefónica Group and 48% by the Government)  have reached  a final agreement to restructure their fixed and mobile business in Colombia.


Such agreements include, among other commitments, the assumption by the Government of 48% of the payment obligations not yet due of Colombia Telecomunicaciones, S.A. ESP to the Patrimonio Autónomo Receptor de Activos de la Empresa Nacional de Telecomunicaciones - PARAPAT.


The agreements reached also include an amendment to the Operating Contract for the extension in six years, to 2028, of the payment obligations not yet due of Colombia Telecomunicaciones, S.A. ESP to the PARAPAT.


As a result of these agreements, the net financial debt which will be fully consolidated in the financial statements of the Telefónica Group, will fall by approximately 1,300 million euros.


This agreement includes, and is subject to the merger of Colombia Telecomunicaciones, S.A. ESP and Telefónica Móviles Colombia, S.A. that will become effective after the approval has been granted by the General Shareholders' Meetings of both companies, (whose shareholders, as mentioned above, are companies of the Telefónica  Group and the Government), due to take place on 24 April 2012, and after receipt of the appropriate regulatory approvals.



Following the merger between Colombia Telecomunicaciones, S.A. ESP and Telefónica Móviles Colombia, S.A., Telefónica will hold 70% of the share capital of the resulting company while the Government will control the remaining 30%. Likewise, by virtue of the agreements signed, the Government could increase its stake in the merged company in an additional 3% by 2015, based on its operating performance.


The merger of both companies will create the second largest integrated operator in Colombia and will allow the new company to strengthen its competitive position in the Colombian market and improve its outlook for future growth. Based on integrated, flexible and efficient management, the Company will offer a full range of telecommunications services. This, together with the larger size of the Company, will enable the capture of important synergies in the coming years.




Madrid, April 2nd, 2012



This information is provided by RNS
The company news service from the London Stock Exchange

a d v e r t i s e m e n t