Telefonica SA (TEF), Spain’s biggest phone company, will sell a 50 percent stake in online travel agency Rumbo as the debt-ridden Spanish phone operator trims debt.
Tourism company Bravofly SA, based in Chiasso, Switzerland, will buy Telefonica’s stake and also the 50 percent held by Spanish travel operator Orizonia, the companies said in an e- mailed statement today. The deal is worth about 74 million euros ($95 million).
Telefonica Chief Executive Officer Cesar Alierta is reversing a decade-long expansion strategy by selling assets to avoid a reduction of debt ratings. Europe’s most-indebted phone operator, which raised 1.45 billion euros this week selling shares in its German unit, has canceled its dividend and a share buyback plan for this year.
Telefonica rose 0.9 percent to 10.36 euros in Madrid today, valuing the company at 47.1 billion euros.
Rumbo, founded in 2000, operates in Spain, Portugal, Brazil, Argentina, Colombia and Venezuela. The website has about 2 million registered customers, according to a company presentation.
As it struggles to cut more than 58 billion euros of net debt, Telefonica also plans to spin off its Latin American business. In July, it divested a $1.4 billion stake in China Unicom (Hong Kong) Ltd. and this month it agreed to sell its Atento call-center division to Bain Capital Partners LLC in a deal worth 1.04 billion euros.
After the acquisition, Bravofly’s annual revenue will reach 900 million euros, and the Swiss company will operate in more than 20 countries from Latin America to Russia, with more than 850 employees, according to the statement. Rumbo, which also manages the Viajar.com and Rumbo Negocios brands, will keep its existing brand structure.
“The acquisition of Rumbo will strengthen our leading position in the online travel industry, coupling with our diversified presence across Europe,” Bravofly Chairman and Founder Fabio Cannavale said in the statement.
To contact the reporter on this story: Manuel Baigorri in Madrid at firstname.lastname@example.org
To contact the editor responsible for this story: Kenneth Wong at email@example.com