The government of Javier Milei has suspended in a “preventive” way on Friday at the last minute the sale operation of the Argentine subsidiary of Telefónica to the company Telecom Argentina, owned by 80% of the powerful Clarín group, of local capitals. In a statement that carries the signing of the president’s office, the Casa Rosada warns that it responds to a recommendation from the Competition Defense Commission, “attentive to the fact that the merger of both companies would significantly increase their market share.”
According to the calculations of the Argentine Government, in case Telecom adds Telefónica’s assets, “61% for the mobile phone market, 69% for fixed telephony” and up to “80% of the residential Internet service in some areas of the country.”
“The process of evaluation of the effects of the acquisition notified to the National Commission for Defense of Competition requires the maximum rigor, respecting the applicable regulations and international standards, in response to the relevance of telecommunications in today’s world. That is why the decision has been made to protect the transparency and free of the market by means statement.
Telefónica approved on February 24 the sale of its business in Argentina for 1,245 million US dollars (approximately 1,189 million euros to the current exchange rate) to Telecom Argentina. It was the first corporate operation that signed the Spanish telecommunications giant
The Argentine government warned that it would apply antitrust regulations, because “70% of telecommunications services would remain in the hands of a single economic group, which would generate a monopoly, formed thanks to decades of state benefits.” The background is the fight that Milei maintains with the Clarín Group, editor of the Clarín newspaper, the largest circulation in the country, in addition to the 24 -hour TN news signal, Channel 13 of Television and Radio Miter. Even today, Milei keeps a tweet of March 2 that titled “Clarín: the great Argentine scam”. In a long text, he accuses his journalists “to host the government with lies simply because we said that we were going to defend the Argentines of the abuse of the dominant position that the group wants to have in the world of telecommunications.”
Milei’s zeal against an eventual monopoly contrasts with what he held in mid -February in Washington DC. Towards the end of his speech, he said that, after many years of study, he had understood that “monopolies are not bad, unless they are armed by the State.” According to the logic of the ultra -rightist, the state control bodies would have nothing to say about a purchase and sale of private companies.
From Telecom Argentina they assured at the time of purchase that the Adquision of Telefónica does not imply the formation of a monopoly because “they are companies that have complementarity in services and geography.” “These consolidations are being given in telecommunications companies around the world. Telefónica had made the decision to retire years ago and that led to a non -investment system,” the company’s external communications director, Pedro López Matheu, told El País. “There is the opportunity for a group of national capitals to consolidate their investments in Argentina,” he added.
Telefónica, who was present in Argentina since 1990, when the government of the Peronist Carlos Menem (1989-1999) privatized state Entel, had entrusted the sale of his business in Argentina to JP Morgan and the law firm Latham & Watkins, as part of a broader strategy of divestment in Latin America.
