- Telefónica has agreed to sell its Colombian telecoms stake to Millicom
- The deal cuts net debt by about €1.55bn and sharpens the group’s regional focus
What happened: A clean exit to cut leverage
Telefónica has agreed to sell its majority stake in its Colombian telecoms business to Millicom, a move that will reduce the Spanish group’s net debt by around €1.55bn. The transaction, reported by TipRanks, forms part of Telefónica’s long-running effort to simplify its portfolio and strengthen its balance sheet.
Telefónica, one of Europe’s largest telecoms operators, has spent several years reducing exposure to parts of Latin America where returns have lagged and currency volatility has complicated capital planning. The Colombia deal involves the sale of Telefónica’s interest in Coltel, the operator behind the Movistar brand in the country, to Millicom, which already has a strong presence in the region.
According to the company, the disposal is expected to improve Telefónica’s leverage metrics immediately, freeing up capital for investment in priority markets such as Spain, Germany, the UK and Brazil. The group has repeatedly said it wants to focus on territories where it holds scale advantages and clearer paths to sustainable cash flow.
Millicom, for its part, is doubling down on Latin America. The company operates under the Tigo brand across multiple countries and has positioned consolidation as a way to extract efficiencies in competitive mobile markets.
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Why it’s important
The sale highlights how European telecoms groups are increasingly using asset disposals as a fast route to deleveraging. Years of heavy spectrum spending, 5G roll-outs and fibre investment have left balance sheets stretched, while revenue growth has remained muted.
From a financial perspective, asset sales offer immediate relief compared with incremental cost-cutting. Reducing debt can lower financing costs at a time when interest rates, though easing, remain well above the ultra-low levels of the previous decade.
Strategically, the move also signals a retreat from the idea of being a truly global operator. Telefónica’s Latin American footprint has steadily shrunk, reflecting a belief that operational focus now matters more than geographic reach. The risk is that selling growth markets limits upside if emerging economies rebound faster than Europe.
For Millicom, the transaction reinforces a regional consolidation play, betting that scale within Latin America can still generate acceptable returns even as global telecom valuations remain under pressure.
