Telefonica de Espana SA is continuing talks with several international telecommunications groups about their acquiring a stake in its Telefonica Internacional SA subsdiary, the company told Reuter in Madrid, but insisted that a report that GTE Corp would take a 25% stake was premature. We are holding regular and constant talks with a number of people, including GTE, AT&T and others, but there is no question of any agreement at this stage, it said. Expansion newspaper reported on Friday that GTE Corp – which has shown keen interest in the Latin American market where Telefonica is a major player – would take a stake of 25% to 30% of Telefonica Internacional, which is 76.22%-owned by Telefonica de Espana – GTE would acquire the 23.78% held by the state, and further shares direct from Telefonica. The paper said the deal could involve an exchange of TISA shares for GTE assets in Latin America, which include participations in telecommunications companies in Chile, Venezuela and the Dominican Republic. Telefonica now has investments in Argentina, Chile, Peru, Venezuela, Colombia and Puerto Rico. Its equity valuation is put at about $1,000m but the company recently took on $1,000m in debt in a bridge credit arranged by ABN-Amro to finance purchase of those two Peruvian telecommunications companies. Expansion said the final agreement between GTE and Telefonica will be signed over the next few weeks, probably by the end of July, and hinges on negotiations over the value of the unit. Telefonica declared that the report in Expansion was full of errors.
