Last week, an Italian newspaper said that Telefónica was working with America Movil and Oi to bid for TIM Brasil, with the intention of breaking it up.
However, in a statement to Spain’s stock market regulator today, the Spanish operator said: “Telefónica would like to clarify that it is not part of any such vehicle and it has no details of any kind on any such potential transaction to disclose to the public for market evaluation."
The company has also denied any involvement with Brazilian competition watchdog Cade over such a deal.
In December last year, Cade said that Telefónica must exit all stakes in TIM Brasil, or find a new partner for its mobile nit Vivo.
Sources told Reuters that Telefónica’s Vivo is a strategic asset; the same sources which said Telefónica was looking to break up TIM Brasil.
In its statement today, Telefónica also said it was looking at the possibility of taking legal action against Cade for its “unreasonable” solutions.
Shares in Telecom Italia rose 7% on Friday following news of the alleged bid, but were down 0.9 % this morning after the statement was released.
