Argentina Halts Telecom Merger Over Monopoly Concerns

Argentina's presidential office has temporarily suspended the merger of Telecom Argentina and Telefonica's local unit to prevent market concentration. The merger would have led to significant dominance in various telecom sectors, prompting government intervention to ensure fair competition.

Argentina's presidential office has intervened to halt Telecom Argentina's acquisition of Telefonica's local unit, issuing a preventive measure against the deal. The decision responds to fears of substantial market concentration that could stifle competition.

Telefonica, based in Spain, planned to sell its Argentine operations to Telecom Argentina for $1.245 billion. The sale was part of a broader move to lessen Telefónica's footprint in Latin America. Argentina's government, under President Javier Milei, pledged to prevent any potential monopoly from forming, maintaining the suspension until further investigation.

The National Commission for the Defense of Competition advised the Argentine government to pause the transaction due to the potential market domination: 61% in mobile phones, 69% in fixed-line services, and up to 80% in residential internet in specific regions. Meanwhile, Telecom Argentina intends to continue its commitment to investing in telecom infrastructure, focusing on 5G and fiber optic network expansion.

(With inputs from agencies.)