Opinion | Telefonica-Unicom: is a divorce imminent?
Telefonica could soon sell its remaining stake in China Unicom, ending an unsuccessful relationship that benefited neither side
Obviously the reduction in this particular case is miniscule, and most people would say that Telefonica still holds 5 per cent of Unicom. But it's interesting to note that this move officially pushes Telefonica's stake below the 5 per cent level, which could be a some kind of threshold necessary for a next step that could see a total disposal of the stake.
Such a sale wouldn't be a huge surprise, since media have been speculating about it for a while. One report earlier this year said Telefonica was actually pursuing a sale. Another one last month said Telefonica was in need of cash to pay down its big debt, and that a sale of its Unicom stake, then valued at €1.3 billion euros, would be one of the easiest options.
It's not difficult to see why such a sale would be easy, as there's probably little or no actual relationship between the two companies beyond their equity relationship. Telefonica was full of hope for the partnership when the two sides strengthened an existing tie-up three years ago as part of the Spanish telco's hopes to eventually do business in China. But nothing ever happened in the partnership, as Unicom became embroiled in its non-stop management reshuffles and Telefonica faced its own debt explosion amid the European debt crisis.