ATLANTA -- BellSouth Corp. agreed to sell its stake in 10 Latin American operations to a wireless unit of Spanish telecommunications giant Telefonica SA for about $4.2 billion in cash and an additional $1.5 billion in debt.
BellSouth said it expects to record a gain from the sale to Telefonica Moviles in 2004. The company said the deal improves its flexibility and allows it to focus on its domestic business.
Proceeds from the sale also will help fund BellSouth's $16 billion share of last month's deal to acquire AT&T Wireless.
BellSouth owns 40 percent of Cingular, with SBC Communications of San Antonio owning the other 60 percent.
BellSouth, whose shares fell 4 cents to close at $28.80, said the purchase price is based on a total enterprise value of $5.85 billion for the interests changing hands. Combined revenue for the 10 Latin American companies was $2.5 billion in 2003.
Telefonica Moviles will acquire 100 percent of BellSouth's stakes in its operators in Argentina, Chile, Peru, Venezuela, Colombia, Ecuador, Uruguay, Guatemala, Nicaragua, and Panama, making it the only cellular operator in all the key Latin American markets.