Telefónica closed the sale of its entire mobile operation in Chile to the joint venture of French holding company NJJ and Luxembourg‑based Millicom for a total consideration of approximately $1.215 billion, including a contingent payment of up to $150 million tied to performance milestones in the Chilean market.
The transaction removes a unit that carried a net financial debt of €479 million (about $571 million) at the end of 2025, and the proceeds will be used to strengthen Telefónica’s balance sheet, reduce leverage, and fund network modernization in its core markets of Spain, Brazil, Germany and the United Kingdom.
The sale is part of Telefónica’s broader Latin‑American exit strategy, which has already divested operations in Argentina, Peru, Colombia, Ecuador and Uruguay. By shedding a low‑return asset that has faced declining average revenue per user and mounting losses, Telefónica can concentrate resources on high‑growth, high‑margin segments such as Telefónica Tech, which is driving digital transformation, AI, cloud, IoT and cybersecurity services.
Millicom will operate the Chilean business from day one, while NJJ, the investment vehicle of Xavier Niel, provides capital and strategic oversight. The partnership allows Millicom to expand its footprint in South America without taking on the full balance‑sheet exposure of the Chilean operation.
CEO Marc Murtra emphasized that the divestment aligns with Telefónica’s “Transform & Grow” strategy, which prioritizes operational simplification, cost discipline and investment in technology that delivers higher margins. Murtra noted that the company’s core markets now represent a more solid and scalable foundation for long‑term growth.
Chile’s mobile market has become highly competitive, with rivals such as WOM filing for bankruptcy and Telefónica Chile reporting losses and a shrinking market share. The sale reflects the company’s assessment that the Chilean unit no longer delivers the returns required to justify its cost base in a price‑sensitive environment.
By completing the sale, Telefónica removes a drag on its free‑cash‑flow quality and reduces its debt burden, thereby improving its capacity to invest in network upgrades and digital services. The proceeds also support the company’s goal of a leaner, more profitable structure that can better withstand volatility in emerging markets.
The transaction signals Telefónica’s continued commitment to its core markets and its digital services arm, while Millicom’s expansion underscores the attractiveness of the South‑American telecom landscape for investors seeking growth in emerging markets.
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