Spanish telecommunications giant Telefónica is exiting the Mexican market, announcing an agreement to sell its local subsidiary to the Melisa Acquisition consortium for $450 million. The deal marks the end of a long-term strategy to divest from Hispanoamerican assets and reconfigure the company's international portfolio.
Melisa Acquisition, a partnership between the tech firm OXIO and Newfoundland Capital Management, will take control of Pegaso PCS and Celular de Telefonía, the parent companies of Movistar Mexico. The transaction follows a favorable $280 million tax ruling for Telefónica in February 2026, which cleared the final financial hurdles for the sale.
Market pressures and the rise of virtual operators
Telefónica’s decision to leave Mexico stems from years of intense market competition and evolving consumer habits. The rise of Mobile Virtual Network Operators (MVNOs), particularly Walmart’s Bait, fundamentally shifted the industry landscape.
According to data reported by Expansion, Bait surged to 23.5 million active lines by the end of 2025, surpassing Movistar’s 21.7 million subscribers. Bait added two million users in the third quarter alone, effectively squeezing Movistar’s ability to grow its base through aggressive pricing.
Since 2019, Telefónica had already pivoted to a "light" business model to mitigate these pressures. The company returned its spectrum licenses and moved to lease network capacity from third parties, a move designed to reduce costs and financial risk.
Despite the agreement, the sale is not yet finalized. The transaction remains subject to rigorous regulatory oversight. Both the Federal Telecommunications Institute and the national antitrust authority must grant approval before the transfer of control can occur.
Both parties must also satisfy all conditions outlined in the purchase agreement. While the price is set at $450 million, the final figure may undergo standard adjustments common in corporate acquisitions of this scale.
