Telefonica confirmed a previously-rumoured deal which will see it selling its Irish business to 3 Ireland, in a transaction worth €850 million.
The Spain-based group said that this is “part of Telefonica’s ongoing policy of proactive management of its asset portfolio with the aim of increasing the company’s financial flexibility”.
Telefonica is in the process of a debt reduction effort which has seen it selling its Atento call centre business, floating part of its O2 Germany unit, and partnering with Central American investment fund Corporacion Multi Inversiones in this region.
3 Ireland, owned by Hong Kong-based conglomerate Hutchison Whampoa, will pay €780 million in cash on completion, and a further €70 million dependent on meeting certain financial goals.
In a statement, 3 Ireland said that the acquisition of O2 Ireland will give it a market share of 37.5 per cent, with around 2 million active users.
The acquirer also said that the deal will give it “scale and financial strength necessary to compete even more aggressively in the market to the benefit of consumers”, and leaves it “optimally positioned to become the number one player in the Irish market by providing the best value and service to its customers”.
The deal is subject to conditions including securing regulatory approval.
According to a report earlier this month, cable firm Liberty Global and incumbent Eircom had also eyed O2 Ireland.