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Millicom terminates Telefonica Costa Rica purchase agreement, Telefonica to sue

Christian Fernsby |
Millicom International Cellular announced that it has exercised its right to terminate the Share Purchase Agreement (SPA) for the acquisition of Telefónica’s operating subsidiary in Costa Rica in accordance with the terms of the SPA.

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Topics: MILLICOM    COSTA RICA    TELEFONICA   

As communicated on April 29, 2020, closing of the SPA was conditioned upon the issuance of required regulatory approvals that were agreed by the parties and set forth in the SPA, certain of which have not yet been issued.

The SPA establishes an end date of May 1, 2020, after which either party may terminate the agreement, and Millicom has exercised its right to do so.

Telefonica is set to take legal action against Millicom in U.S. courts over the aborted sale of its subsidiary in Costa Rica, citing a submission to market securities regulator.

The report said Telefonica intends to file a lawsuit against Millicom as soon as US courts resume non-emergency procedures to demand compliance with the agreement and compensation for any damage caused.

However, Millicom subsequently issued a statement strongly refuting Telefonica’s allegations regarding the conditions for closing the Costa Rica deal. It added that “in the event that the pending regulatory approvals for the transaction are not issued by May 01, 2020″ it intends to terminate the agreement in accordance with the terms thereof.

Millicom also said it intends to vigorously defend itself against any action brought by Telefonica in the matter.


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