Telefónica Taps Citi to Sell Chile Unit Amid Strategic Realignment

Telefónica (NYSE:TEF), the Spanish telecom giant, has reportedly enlisted Citi to spearhead the sale of its Chilean business, according to Spanish news outlet El Confidencial. The move aligns with Telefónica’s broader strategy to streamline operations and divest non-core assets in Latin America.

Sources familiar with the matter say Telefónica is also working alongside Rothschild and Santander (BME:SAN) to explore potential buyers for its operations in Chile. The company has been steadily reducing its footprint in Latin America, shifting focus to key markets such as Spain, Brazil, Germany, and the UK. Chile, though profitable, is seen as part of the group’s secondary portfolio under review for divestment.

Telefónica’s Latin American exit strategy gained momentum in recent years as the company seeks to cut debt and reallocate resources to high-growth digital services and core European markets. In 2021, it completed the sale of its Costa Rican unit to Liberty Latin America, and earlier divested stakes in its Central American assets.

The potential sale of Telefónica Chile would mark another step in the telecom’s long-term transformation plan. Analysts note that while the Chilean market is relatively stable, fierce competition and evolving regulatory dynamics have prompted multinational telecoms to reassess regional investments.

No official statement has been released by Telefónica, Citi, Rothschild, or Santander regarding the deal. However, industry insiders suggest that initial interest from regional telecom operators and private equity firms has already surfaced.

As Telefónica continues to reshape its global footprint, the Chilean divestiture could unlock capital and strengthen its balance sheet, helping the company focus on next-generation connectivity, 5G expansion, and fiber-optic infrastructure in strategic markets.