Telefónica has approved a five-point action plan that will serve as a catalyst for the company’s transformation.
Its strategic decisions, presented in a letter by the chairman and CEO José María Álvarez-Pallete, are a focus on the key markets of Spain, Brazil, the UK and Germany: the creation of Telefónica Tech; the creation of Telefónica Infra; the operational spin-off of Hispanoamérica; and the redefinition of the corporate centre.
Telefónica expects these measures to generate more than €2 billion of additional revenues, with a two percentage point increase in operating cash flow margin, by 2022.
It notes that in Q3 2019 Spain, Brazil, the UK and Germany, despite the company being present in 14 countries, accounted for 218 million accesses, or 63% of the total, approximately 80% of revenues, OIBDA and operating cash flow.
The four country heads will continue to report to Angel Vilá, the company’s COO.
Meanwhile, Telefónica Tech will bring together businesses with high growth potential and initially focus on cybersecurity; IoT/Big Data; and cloud. These businesses are already growing revenues by more than 30%. José Cerdán, the CEO of this new company, will also report to Angel Vilá.
Telefónica Infra, on the other hand, will increase the value of assets and accelerate growth. It will be headed by Guillermo Ansaldo, who too will report to Angel Vilá.
The fourth initiative will see the creation of a unit that brings together all the company’s businesses in Latin America, with the exception of Brazil. Headed by Alfonso Gómez, currently responsible for Hispam Norte, it will seek out conditions to maximise its value through growth, consolidation and possibly also corporate transactions.
The corporate centre will focus on “activities that provide a differential value to the other units and will capture the value of scale.
The plan comes alongside the departure of Mariano de Beer and Bernardo Quinn from the executive committee.
However, both with remain in non-executive positions in the company.
