Saudi Arabia’s stc Group has made a significant move in the global telecommunications and technology sector by acquiring a 9.9 percent stake in multinational telecommunications company Telefonica. This strategic investment reflects stc Group’s commitment to expanding its presence and portfolio in the industry.
stc Group, also known as Saudi Telecom Company, is a major telecommunications player based in Saudi Arabia. The acquisition of a stake in Telefonica, a multinational giant operating in several key markets, including Spain, Germany, the UK, and Brazil, demonstrates stc Group’s ambitions on the global stage.
Financial Details: stc Group’s acquisition of a 9.9 percent stake in Telefonica comes at a total cost of SAR 8.5 billion (EUR 2.1 billion). This substantial investment signifies stc Group’s confidence in Telefonica’s sustainable growth and potential.
Expansion and Growth Strategy: This acquisition aligns with stc Group’s broader expansion and growth strategy, highlighting its commitment to the telecommunications and technology sectors. The company has been actively investing in the ICT (Information and Communications Technology) sector, both domestically and internationally. For instance, its ICT infrastructure subsidiary, Tawal, recently acquired telecommunications tower assets in Europe, further expanding its global reach.
Telefonica’s Strengths: Telefonica is renowned for its robust infrastructure assets and advanced technology platforms. It also leads in emerging technology areas such as cognitive intelligence, edge computing, and the Internet of Things (IoT). These strengths make it an attractive investment opportunity for stc Group.
Long-Term Investment: The acquisition is framed as a long-term, supportive investment by stc Group. The company has clarified that it does not intend to acquire a controlling or majority stake in Telefonica. Instead, it views this investment as a compelling opportunity while maintaining its dividend policy.
Strategic Alignment: Both stc Group and Telefonica share a vision of using technology to connect people and have strategies focused on driving growth to create value. stc Group is committed to strengthening this partnership further.
With this acquisition, stc Group diversifies its portfolio and expands its footprint in the global telecommunications and technology sector. This strategic move reflects the company’s ambition to play a significant role on the international stage in the years to come.
