Telefonica Moviles "sell"

03/04/04 - Ibersecurities

LONDON, March 4 (New Ratings) – Analysts at Ibersecurities reiterate their "sell" rating on Telefonica Moviles (TEL). The target price is set to €9.30.

Shares of Telefonica Moviles, a leading telecom service provider operating in the Spanish and Portuguese speaking markets, are currently trading at €9.08.

According to Ibersecurities' research note published this morning, Telefonica Moviles is likely to acquire BellSouth's cellular assets in Latin America in the near term. The analysts say that the company has been negotiating with BellSouth and the deal is expected to involve €4.60 billion. Telecom Italia and America Movil have indicated their interest in BellSouth's assets, the analysts add.

The expected acquisition is likely to enable Telefonica Moviles to gain a foothold in those Latin American countries where its presence is limited. In countries like Argentina and Chile, the acquisition would offer Telefonica Moviles a significant competitive advantage, Ibersecurities adds. The analysts express their concern regarding the integration issues involved with this acquisition.

Ibersecurities reiterates its "sell" rating on Telefonica Moviles.