América Móvil sells Claro Panama business
Mexican telecom giant America Móvil has announced the sale of its Claro Panama business to Cable & Wireless Panama (CWP), a subsidiary of Liberty Latin America, for $20 million on a cash and debt-free basis.
The transaction is subject to regulatory approvals and is expected to close during the first half 2022, and Liberty Latin America plans to invest $500 million in developing the business, according to a company press release.
“These investments will position CWP to lead the launch of new technologies such as 5G as soon as the regulatory authorities approve the implementation framework,” CWP said.
“It will also enable the large-scale improvement of connectivity and coverage nationwide. They will significantly help bridge the digital divide and continue to connect the unconnected,” the company added.
"This acquisition will result in the combination of two networks that will bring significant benefits to our customers who will enjoy a better network experience, more robust, with greater technological innovation to meet the growing needs of connectivity, capacity, speed, products, solutions, very competitive offers and expanded coverage, allowing to advance in the consolidation of Panama as a telecommunications hub in the region," according to Julio Spiegel, chairman of the board of CWP.
The transaction excludes all telecommunication towers owned indirectly by América Móvil in Panama, and the Claro trademarks.
America Móvil is separating tower business from its telecom operations, and will retain its towers in Panama and act as co-operator, sharing its passive infrastructure.
Liberty Latin America’s CEO Balan Nair said: “We see [Panama] as an important digital hub for the region, which we expect to drive growing demand for our full suite of mobile and fixed connectivity solutions.”
“The valuation for the acquisition is consistent with our disciplined approach towards M&A and will be free cash flow accretive on a per share basis,” Nair added.
Claro Panamá generated $157 million in revenues in the fiscal year ended December 31st, 2020, and had 760,000 mobile subscribers at end-June 2021.
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