Telefónica seeks to quash AT&T takeover deal rumors

Telefónica on Monday sought to quash rumors that it had been approached by US operator AT&T with a view to a possible buyout deal. The Spanish telecoms giant told Spain’s market regulator, the CNMV, that there had been no such contact, “nor any indication of written nor verbal interest, from anyone.”

José Manuel Soria, the industry minister, also denied on Monday that there was any interest on the part of AT&T to acquire the Spanish company. From the United States, a spokesperson for AT&T declined to make any comment on the matter.

“I have been in a few meetings with AT&T heads in [the mobile forum in] Barcelona, specifically with the executive president,” Soria told reporters from state broadcaster TVE. “They told me they were interested in Europe but they didn’t say a single thing about a takeover of Telefónica.”

Government sources have been briefing for several weeks in private that there is a huge amount of interest to invest in Spain and, to back up that theory, they say that they had to intervene to stop a major operation last month. According to information published on Monday by El Mundo, the Telefónica operation would have consisted of a friendly takeover, but it was halted last month. Government sources have since clarified that it was actually stopped at least four weeks ago.

Market sources say that it could not be a friendly takeover in its final phase, given that there has been no contact between AT&T and Telefónica. Other sources suggest that there could have been a simple approach on the part of an investment bank or a government intermediary, who wanted to show that the Spanish economy is not in such a bad way and that there is investor interest in firms here.