Telefonica Has Approached Vodafone on Spanish Broadband Deal

Clara Hernanz Lizarraga, Bloomberg News

A Telefonica logo above the Telefonica SA stand on the opening day of the MWC Barcelona at the Fira de Barcelona venue in Barcelona, Spain, on Monday, June 28, 2021. MWC Barcelona, which in 2019 attracted 109,000 attendees from 198 countries, was one of the first major European conference casualties due to the pandemic when it was axed in February last year. , Bloomberg

(Bloomberg) -- Telefonica SA has approached Vodafone Group Plc about a potential deal involving internet broadband networks in Spain, as the British telecom firm reviews options for the unit.

Telefonica has presented various alternative proposals to Vodafone in talks in recent months, the Madrid-based firm’s Chief Operating Officer Angel Vila said in an interview. “The ball is now in their court,” he said.

One option is migrating Vodafone’s clients onto Telefonica’s fiber network as the British carrier turns off its copper cables, he said, adding that Telefonica will continue trying to convince their rival of doing a deal, such as a wholesale agreement or a partnership.

Telefonica initially said it was interested in exploring partnerships with Vodafone in May, after the British carrier announced a strategic review of the Spanish unit. Vodafone’s operations in the country have suffered from years of cut-throat competition.

Although Telefonica has said it’s only focused on the broadband business, Vodafone has also received interest for the entire unit from buyout firms, people familiar with the talks told Bloomberg.

Partnerships to share infrastructure, such as broadband networks and masts, are common in the telecom industry, as are wholesale agreements that allow an operator to access a rival’s network.

Although Telefonica owns Europe’s largest network in Spain and several other operators, including Orange, also have fiber broadband networks in the country, Vodafone mostly offers broadband through older, pricier cable technology.

A press officer for Vodafone declined to comment.

--With assistance from Thomas Seal.