MasMovil, Vodafone merger talk refuses to die

MasMovil has reopened discussions with Vodafone about a possible merger of their Spanish businesses, according to local press reports.

You could be forgiven for getting a feeling of déjà vu: MasMovil denied a similar report in September last year and that was far from the first time the telco had been linked with a major merger in Spain.

It has, of course, been a big player in M&A in recent years, building up its own business through the acquisition of a number of smaller market players, including Lycamobile, Lebara, Llamaya and others. But talk of a tie-up with one of the big three just will not die, and once again it is Vodafone in the frame.

The latest report comes from Spanish newspaper Expansion, which said the parties are aiming to reach agreement before the country’s upcoming auction of 700 MHz spectrum, due to take place imminently.

It’s not clear who would be buying whom in this scenario, but according to Spanish tech publication Xataka, MasMovil has valued Vodafone Spain at €7.5 billion. That’s higher than the €6 billion it valued the business at previously and is possibly the driving force behind the reopening of discussions between the operators.

There is also the question of the 700-MHz sale. Inking a deal prior to the auction would make a difference, putting the companies in a better position for the auction.

The auction is due to take place before the end of this quarter, which essentially means in the next three weeks, having been delayed due to the Covid-19 pandemic. However, there are now rumours that it will be delayed again, this time until June, which would give Vodafone and MasMovil a little more breathing space to hammer out a deal…if it is indeed their goal to do so ahead of the sale.

As we might have expected, neither company has commented on the report.

We can be pretty sure that one of two things will happen though: either MasMovil and Vodafone will announce a merger deal, or there will be a brief period of quiet before the Spanish press once again publishes rumours of upcoming mobile consolidation.