Tag Archives: Merger

America Movil Ponders Merging Cable TV, Telecom Operations in Brazil

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Things are heating up in Brazil over broadband as America Movil has publically announced studying the possibility of streamlining its Brazilian operations by merging its cable TV operations with its fixed and mobile carriers. According to America Movil the move could be the best way to gain ground in the hotly competitive Brazilian communications market.

While nothing is set in stone, the plan would structurally integrate Embratel Participacoes, the country’s 3rd-largest wire-line telecom, with mobile operator Telecom Americas, and cable TV operator Net Servicos de Comunicacao. Before the merger is taken to the next phase, however, the companies must carefully look at their options, and no deal has been made yet.

Last year, Mexico’s America Movil blew away the pay-TV competition in Latin America by merging all of its regional operators (Net Servicos, Telmex, Telmex International) to create one solid entity. In doing so, they have swallowed up the competition, holding 22 percent of the regions 51 million subscribers, making it the leader on the continent.

A similar move was made successfully last year by Telefonica, who merged their mobile and fixed-line divisions in Brazil into one single unit.

Many suspect that this may have been inspired by America Movil’s 2012 4th quarter revenue dip. Which was a bit less than previous gains, holding at USD $ 16.2 million. With this new announcement, America Movil plans on kick-starting their Brazilian revenue stream by reorganizing its sources, and making the overall market value more efficient.

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Iusacell confirms merger of Televisa-Iusacell has been rejected

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Iusacell has announced it has been notified by Mexico’s anti-trust watchdog the Federal Competition Commission (CFC) that its planned deal with Televisa has been rejected, Notimex reports. The five-member commission voted 3-2 against the partnership, Iusacell said.

In April 2011, Televisa agreed to invest USD 1.6 billion for a 50 percent stake in Iusacell. The deal was expected to provide money for Iusacell to expand its business and give Televisa, which also offers fixed-line voice and internet services, an entry into the mobile market.

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Jamaica's FTC takes legal action on Digicel/Claro merger

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Jamaica’s Fair Trading Commission (FTC) has taken legal action to prevent the approved merger of mobile operators Digicel and Claro. The FTC filed a lawsuit with the High Court this month, seeking several declarations that, if granted, would result in the scuttling of the merger and fines of USD 5 million against Digicel Jamaica and Oceanic Digital Jamaica for breach of the Fair Competition Act, the Jamaica Observer reports.

The FTC will be asking the court for an injunction to block the merger, which it claims would result in lower competition in the telecoms market. According to the lawsuit, between April 2007 when Claro entered the market, and March 2011 when the merger was announced, “customers’ benefits from competition” among the Digicel, Claro and Lime have “exceeded USD 16 billion”.

The FTC alleges that this financial benefit to customers would be reduced should the merger go through.

C&W calls for Digicel-Claro Jamaican Merger to Be Investigated

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Jamaica’s Cable & Wireless – opertating under the brand LIME – has written to the Government, the Office of Utilities Regulations (OUR) and the Fair Trading Commission (FTC) expressing concerns about the recently announced deal for Digicel to buy its local rival, Claro.

Digicel and Claro announced last week that Digicel would sell its businesses in El Salvador and Honduras to America Movil, while in turn Claro Jamaica would be sold to Digicel.

According to analysts, the combined market share of the two companies in Jamaica comes to 80%, leaving Cable & Wireless (LIME) with the remaining 20%. The move has raised concerns that Digicel is effectively returning the country to a de-facto monopoly status.

The company said that given the significance of the merger to the Jamaican telecoms industry, the regulators “should carefully assess the deal, before approval is given by the relevant minister”.

“As a company proudly serving Jamaica for over 140 years, providing employment for more than 1,400 Jamaican workers and with almost 25,000 Jamaican shareholders, we stand ready to cooperate with all industry players to ensure the interests of our country and the Jamaican consumer are best served,” Lime’s managing director, Garry Sinclair said in a brief statement.

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