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Telecom Italia appeals Argentina ruling
15 January 2010
Telecom Italia is saying that the government of Argentina is being unjust in requiring it to divest its stake in Telecom Argentina. Telefónica, which owns a large stake in Telecom Italia, is also active in Argentina
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Argentina
Telecom Italia
Telefónica
Telmex
América Móvil
Comment: Telecoms operations in South America are concentrated in remarkably few hands: Telefónica is one of the largest; Carlos Slim’s Telmex and América Móvil are huge; and Telecom Italia is active in a number of countries.
Telecom Italia has appealed against an Argentinian antitrust ruling, which requires divesting its stake in Sofora, the parent of Telecom Argentina. The Italian telecom operator, which holds 50% share of Sofora, has called the claims against it as “illegitimate and unjust”.
Argentina’s National Antitrust Commission has set the ruling considering that there is an excess concentration of power in the local market.
This comes as one of Telecom Italia’s indirect shareholders, Telefónica, controls the other big operator in the country, Telefónica de Argentina. Telefónica has an indirect stake of about 22.5% stake in Telecom Italia via a company called Telco.
Argentina’s antitrust agency has restated an August 25 2010 deadline for Telecom Italia to divest its stake in Telecom Argentina. The government could, however, take a more active role in the sales process if the firm does not show any progress by February 25 2010. GTB