O2 owner Telefonica yesterday sold an eight per cent stake in Portugal Telecom (PT) to other PT shareholders in a deal worth up to €800m (£659m).
The sale has been seen as evidence of an increasingly strained relationship between the two Iberian telecoms giants, centering around their battle to dominate the lucrative Brazilian mobile market.
The deal comes ahead of a meeting next week at which PT shareholders will decide whether to accept a €6.5bn offer by Telefonica to buy out PT’s stake in Brazil’s largest mobile phone company Vivo, which is a joint venture between the two.
Critics had argued Telefonica would have a conflict of interests if it was allowed to vote on its own offer.
The sale represents almost all of Telefonica’s estimated 10 per cent stake in PT. A Telefonica spokesman declined to comment and PT was not immediately available to comment.
Shares in PT closed 0.6 per cent higher at €8.99 while Telefonica closed 0.2 per cent lower at €16.320.
The two firms are already involved in a legal dispute over the Portuguese government’s stake in PT, which gives it a “golden share”, allowing it to block an attempted takeover. The European Court of Justice is expected to strip the government of its rights to do this.