News

New bidder for Telecom Argentina

Bnamericas Published: Monday, February 29, 2016

Argentine businessman Carlos Newberry is trying to outbid US investment fund Fintech for Telecom Italia's stake in local telecoms operator Telecom Argentina, according to a Bloomberg report.

Newberry is reportedly prepared to offer 10% more than Fintech, which is headed by Mexican businessman David Martínez. He told Bloomberg that he would raise bidding to US$1.1bn.

Telecom Italia reached a deal with Martínez in 2013 to sell its 68% controlling stake in Sofora Telecomunicaciones, the holding company through which it indirectly controls Telecom Argentina, for US$960mn. However, the regulator has dragged its heels for more than three years.

In October 2014, Telecom Italia amended the agreement to sell only a 17% minority interest in Sofora for US$216mn, saying the remaining 51% would be sold after the regulator approved the deal.

Last week, Fintech launched a bid for Telecom Argentina's Class B shares listed on the Buenos Aires Merval stock exchange.

Martinez, said Fintech was offering 46 pesos (US$2.94) per share. The bid did not include Class C shares, which are owned by the main shareholders.

Argentina's now defunct telecom regulator Aftic blocked the purchase last October, claiming that Fintech had no experience in telecommunications. Under the terms of the agreement between Telecom Italia and Fintech, the companies have until April 2017 to complete the sale.

Bloomberg cited unnamed sources as saying that new telecom regulator Enacom is expected to approve Martinez's offer during its next meeting.

Analyst have said that Martinez's purchase could raise monopolistic concerns given that he also controls 40% of Cablevisión, a cable company owned by local media giant Grupo Clarín. Clarín recently completed the purchase of Nextel Argentina, meaning that Martinez could indirectly end up controlling more than 50% of the broadband market.

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