Liberty and Telefonica agrees for a $38 billion deal to take on BT
Liberty Global Plc (LBTYA.O) and Telefonica SA (TEF.MC) made a deal on Thursday to combine their British businesses at $38 billion including debt. The joint venture will heighten the challenge for British Telecom pioneers in mobile and broadband.
According to Telefonica’s Chief Executive Officer Jose Maria Alvarez-Pallete, the deal is an opportunity to signal investors that he’s committed to restructuring the debt-laden company.
The Madrid-based company failed to sell O2 four years ago.
According to Alvarez, the two companies would be “much stronger together.”
While British regulatory bodies have strengthened their approach in the last few years, the joint venture of a mobile system with a broadband system is probably not going to cause big problems.
Experts anticipate that the arrangement would be approved by regulators.
“It’s not a secret anymore when 5G meets 1 gig broadband we know magic can happen for customers,” Liberty Global’s Chief Executive Officer Mike Fries said in a conference call on Thursday.