Carlos Slim owned Mexican telco America Movil has launched a US$21bn offer for fellow Mexican firms Telmex and Telmex Internacional, firms in which Slim holds a controlling stake.
Slim is taking control of Telmex and Telmex Internacional through the…
Carlos Slim owned Mexican telco America Movil has launched a US$21bn offer for fellow Mexican firms Telmex and Telmex Internacional, firms in which Slim holds a controlling stake.
Slim is taking control of Telmex and Telmex Internacional through the holding firm Carso Global Telecom.
America Movil is to launch a share exchange offer to the shareholders of the firms, offering 2.0474 shares of its stock per Carso share, which would lead to America Movil having an indirect 59.4% stake in Telmex and a 60.7% stake in Telmex Internacional.
As the remaining 39.3% of Telmex Internacional’s shares are not controlled by Carso, America Movil will subsequently offer the shareholders of Telmex Internacional 0.373 America Movil shares per Telmex Internacional share, hoping to snap up the remaining 39.3% in Telmex Internacional. Plans are to delist Telmex Internacional and Carso Global Telecom following the share acquisition.
The move means America Movil would further solidify its already powerful position on the Mexican telecoms market, and would allow it to offer integrated voice, data and video services across the country and potentially also to other countries where it operates.
Slim is thought to want to merge the three telcos, developing a firm which is better able to compete against its rivals such as Spanish telco Telefonica which is gaining a strong foothold. America Movil also faces stiff competition from the country’s cable TV operators such as Televisa, which could be about to move into telecoms, having said it may bid in the upcoming Mexican mobile frequency auction.
Telmex Internacional provides telephony and cable TV services across Columbia, Brazil and a further five South American markets. Carso Global Telecom had 3.5 million subscribers as of the end of Q3 2009. Were Slim to consolidate all three operators, he would create a regional telecoms giant which would service some 250 million subscribers.
Slim acquired Telmex from the Mexican government in 1990 and has since restructured it and expanded it across the Latin America region. America Movil is the mobile phone unit which was spun off from Telmex in 2001.
The acquisitions still need regulatory clearance from a number of regulators, including the Mexican antitrust regulator, the Federal Competition Commission.
