The government of Javier Milei has issued a “preventive measure” that “suspends the effects of the purchase” of the Telefónica subsidiary in Argentina by the Clarín media group for 1,245 million dollars (around 1.2 billion euros).
Despite the intentions of the Argentine government, the sale of the telephone subsidiary in the South American country is already closed and charged, so any regulatory risk will correspond to the buyer, as the Teleco pointed out when he reported the transaction to the National Securities Market Commission (CNMV) at the end of February.
The measure, executed through the Ministry of Industry and Commerce of the Ministry of Economy, It is based on the recommendation of the National Commission for the Defense of Competition that warns that “the merger of both companies would significantly increase their market share,” according to the statement of the Argentine President’s office.
The participation resulting from the operation, according to the Argentine government, “would imply a 61% concentration for the mobile phone market; 69% for fixed telephony; And, regarding the residential Internet service, in some areas of the country the concentration could reach 80%«.
In this sense, the Milei government justifies the decision «of Say transparency and free market concurrence through preventive measure until the analysis of the notified operation is deepened «.
«Through the measure, the national government fulfills its obligation to guarantee rights of users and consumers, as well as defending competition against all forms of market distortion, ”the text has concluded.
Sold for 1,190 million euros
Telefónica sold its subsidiary in Argentina for 1,245 million dollars (around 1.2 billion euros) to Telecom Argentina, of the Clarín media group. It was one of the first draft disinversions since Marc Mutra assumed the presidency of the company on January 18 and is aligned with the Spanish teleco strategy to “gradually reduce” its “exposure to Latin America.”
Milei already threatened to torpedo the sale of Telefónica’s subsidiary in Argentina, raising in his defense of free competition and Users choice. Then, he pointed out that the acquisition “could leave approximately 70% of the telecommunications services in the hands of a single economic group, which would generate a monopoly formed thanks to decades of state benefits that received by said company.”
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