What: Shares of Spanish telecommunications company Telefonica (NYSE:TEF) tumbled on Friday following a report by Bloomberg stating that the company was considering delaying the initial public offerings of two of its units because of Brexit-induced market volatility. At 11:45 a.m. EDT, the stock was down about 17%.
So what: According to Bloomberg, Telefonica was set to announce the IPO of Telxius, its infrastructure unit, next week. Telefonica expected to raise about 1.5 billion euros, with the unit being valued at 3.5 billion euros.
Telefonica was also reportedly considering an IPO for its U.K. wireless unit O2. The company at one point planned to sell the business for 10.25 billion pounds, but the European unit blocked that deal in May.
With the U.K. deciding to exit the European Union on Thursday, global financial markets have been thrown into chaos. Telefonica is reportedly holding discussions with advisors to hash out a new strategy given the current volatility.
Now what: There's a tremendous amount of uncertainty in Europe at the moment following the U.K. referendum, and Telefonica likely has no other choice but to delay its IPO plans. The long-term effects of the U.K.'s exit from the European Union are unclear at this point, but investors are in a panic, sending shares of Telefonica tumbling.