Government’s Announcement Causes Telefónica Shares to Surge despite Opposite Effect Expected: What does it mean for the state and private sector?

The government’s spokesperson, Pilar Alegra, announced at a press conference on Tuesday that the Executive expects the State Society of Industrial Participations (Sepi) to acquire 10% of Telefónica in a short period. This statement came after Sepi notified that it currently holds 3% of the telecommunications operator’s shares.

However, Alegra’s statement had the opposite effect as it caused Telefónica’s shares to rise for the first time since May 2023. By 4:30 p.m., the shares had reached 4.08 euros, representing a 2.26% increase. The rush to complete the operation could potentially increase the final cost by tens of millions of euros, as Sepi will need to disburse an additional 1,600 million euros to reach the 10% ownership stake.

The value of Sepi’s current 3% ownership stake is estimated at over 700 million euros at market price. To reach a full 10% ownership stake, an additional investment of approximately $2 billion will be required. Sepi is not obligated to disclose new purchases until they reach a 5% stake in the capital, which means they still have some room for maneuver before making any significant changes. However, this development has significant financial implications for both parties and could lead to increased scrutiny from regulators and investors alike.

As such, all stakeholders must closely monitor this situation and its potential impact on both companies and the government’s budget.

In light of these developments, it is crucial for all stakeholders to closely monitor the situation and its potential impact on both companies and the government’s budget. It remains uncertain how this deal will unfold in the coming weeks or months, but one thing is certain – there will be significant financial implications for all parties involved.