Mexico’s competition regulator has given AT&T the green light for its US$2.5bn acquisition of local mobile operator Iusacell from broadcast giants Grupo Salinas and Televisa.
The decision comes hot on the heels on the approval of the US incumbent…
Mexico’s competition regulator has given AT&T the green light for its US$2.5bn acquisition of local mobile operator Iusacell from broadcast giants Grupo Salinas and Televisa.
The decision comes hot on the heels on the approval of the US incumbent telco’s purchase of a 41.3% stake in DTH operator Sky Mexico, which is part of AT&T’s game-changing US$48.5bn takeover of US satellite broadcaster DirecTV.
Reuters reported that Mexican regulator the IFT has set undisclosed conditions on the Iusacell deal.
It was operated as a 50-50 joint venture between Grupo Salinas, which owns TV Azteca, and Televisa, which amongst other assets holds the remaining 58.7% of Sky Mexico.
The transaction is structured so that Grupo Salinas will buy Televisa’s stake, and then AT&T will buy 100% of Iusacell from Grupo Salinas.
Iusacell, which also encompasses a separate brand called Unefon, has 8.6 million subscribers leaving it a distant third in the local mobile market behind America Movil’s juggernaut Telcel – which has roughly 70% market share – and Telefonica’s local unit, which has around 20%.
Mexico has imposed a cap on the amount of subscribers America Movil can have at 50% market share, requiring the telco to sell off a significant proportion of its subscribers.
AT&T has been touted as the obvious buyer of the assets, suggested to be worth in the region of US$17.5bn, although the US giant has said it does not need to acquire them for its business plan in Mexico.
Earlier this year, Mexican president Enrique Pena Nieto carried out a number of regulatory changes aimed at boosting competition in the country’s telecoms and broadcast sectors, and attracting foreign investments.
America Movil has been offered the carrot of being able to enter the broadcast sector – which it has been attempting to do for years – once it sells off a sufficient portion of its telecoms business.