Spain’s telecoms sector has been rocked by a deal that would merge the nation’s biggest two players, Nasco and Telefone, into a combined company called ACN.
The deal would create the world’s biggest telecommunications company with revenues of over €100bn and a workforce of more than 100,000 people.
The merged company would be the largest in Europe, with the largest number of subscribers in the European Union and the world, according to a Reuters report on Thursday.
The Spanish government said it had received “very positive responses” from the joint venture, which will be known as ACN Spain.
The move comes as Spanish telecoms regulator, the Communications Authority, is looking into the deal.
Nasco was the world leader in broadband internet, with revenues estimated to be around €2.6 trillion ($3.1 trillion).
The company also has a portfolio of telecommunications services including telephone and TV services, while Telefónica is a leading player in the market for data-telecommunications.
Telefonia, which is a subsidiary of Telefones, had revenues of around €1.7 trillion.
The merger was first reported by the Wall Street Journal, and is expected to be finalized by the end of the year.
“ACN is an exciting development for Spain,” Nasco chief executive Francisco Ferrer said in a statement.
“It will be a great success for our employees and for our customers, who are already enjoying the benefits of an integrated telecommunications network.”
A new Spanish telecom regulator, which was formed by Spain’s former prime minister, had previously said it would look into the proposed merger.
It is not yet clear whether the regulator will be able to do so.
Spain has long been plagued by slow broadband adoption.
A survey last year by the Spanish telecommunications industry association Telefons showed that only 1 in 5 people had access to broadband internet in the country.
In July last year, a report by the Communications Association (ACN) revealed that nearly 60 per cent of Spanish households lacked access to internet access at all.