America Movil has contacted potential suitors including AT&T, SoftBank, Bell Canada and China Mobile to sell some of its telecom business in Mexico for $17.5 billion.
A Bloomberg report said the sale will include America Movil’s infrastructure in a strip of states from north to south along Mexico’s eastern coast.
Billionaire Carlos Slim, promoter of America Movil, wants to avoid penalties from the local regulator because the telecom operator currently controls commanding market share.
The Mexico City-based carrier, which commands 70 percent of the local wireless market and 80 percent of land lines, is selling assets in its biggest market to please regulators as antitrust penalties curb profit. The company may get penalties revoked if it cuts market share below 50 percent.
The Bloomberg report said America Movil hasn’t yet asked for bids because the preliminary information, or teasers, didn’t provide enough details for a company to make an offer.
American Movil Chief Executive Officer Daniel Hajj said on a July 22 conference call that asset sales should foster greater competition in Mexico, satisfying regulators’ requirements. The company is also planning a spinoff of wireless towers, without providing details on the timing.
AT&T is still working to close its acquisition of satellite carrier DirecTV, which has operations inLatin America including a stake in Sky Mexico, the nation’s biggest TV provider. DirecTV shareholders are scheduled to vote on AT&T’s $48.5 billion takeover on Sept. 25.
America Movil plans to enter talks to make a joint bid with Oi for Telecom Italia wireless unit in Brazil.