- Telefónica has reportedly appointed AZ Capital to evaluate an acquisition of Vodafone Spain, working alongside potential partner MasOrange.
- The strategy forms part of Telefónica’s broader ambition to consolidate Spain’s telecoms market, reduce competition costs, and emulate its joint acquisition of Oi in Brazil .
Telefónica explore a possible acquisition of Vodafone Spain
Telefónica, under the leadership of its recently installed CEO Marc Murtra, has reportedly engaged investment bank AZ Capital to assess a potential takeover of Vodafone Spain . Expansion first revealed the appointment, indicating Telefónica’s serious pursuit of its domestic rival. This follows widespread speculation that Telefónica might collaborate with MasOrange on the bid, possibly splitting Vodafone Spain’s assets should a deal proceed.
Zegona, the UK-based fund which purchased Vodafone Spain from Vodafone Group in May 2024 for $5.41 billion, has seen its stock surge nearly 70 per cent this year amid these takeover rumours. Despite fierce market interest, Telefónica’s chairman has dismissed current rumours as speculative, stating no active plan exists ahead of the strategic plan release in H2 2025 .
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Why it’s important
A Telefónica-led acquisition would dramatically reshape Spain’s telecoms landscape. With market shares of approximately 19 per cent in mobile and 14 per cent in broadband, Vodafone Spain trails Telefónica and MasOrange; absorbing it would position Telefónica as a clear market leader . The consolidation from four to three providers could reduce churn and lower customer acquisition costs, potentially improving margins across the sector .
Murtra’s strategy echoes Telefónica’s larger European agenda of championing telecom consolidation to strengthen infrastructure investment and competitiveness, akin to its initiative to assume full control of its UK jointventure and support larger panEU players . Lastly, while Telefónica could fund the deal via debt, the possibilities of an equity raise or partnership with MasOrange mirror its Brazilian strategy in acquiring Oi, illustrating a flexible and regionally tested approach.
