As a result of the conditions imposed by the Superintendence of Competition to carry out the operation, América Movil and Telefónica decided to cancel the agreement to purchase 99.3% of Telefonica Moviles El Salvador.
According to the technical, legal and economic analysis carried out by the Superintendence of Competition SC, it was warned that the acquisition would produce limitations to competition in the markets of mobile and fixed telephony and business connectivity services.
One of the conditions for authorizing the acquisition is that America Movil must relinquish the right to operate 25 MHz of radio spectrum with national coverage in the 850 MHz band and 30 MHz of radio spectrum with national coverage in the 1900 MHz band, which currently belong to Telefonica.
According to the technical, legal and economic analysis carried out, it was warned that the acquisition would result in limitations to competition in the markets for mobile and fixed telephony and business connectivity services. Therefore, the Board of Directors of the Superintendence of Competition (CDSC) decided to impose a set of conditions to repair the damages, which include enforcement measures prior to the closing of the transaction (ex ante) and a series of subsequent obligations (ex post) in order to counteract such limitations, informed the Superintendence of Competition (SC).
After rejecting the two previously filed applications, El Salvador's Superintendence of Competition confirmed that it had received a new request for América Móvil to complete the acquisition process of Telefónica.
In El Salvador, the Superintendence of Competition reported that "it has declared inadmissible the request for economic concentration presented by América Móvil S.A.B. de C.V., on March 5 of this year."
"When a new application for authorization is submitted, the SC will continue this process on the basis of a technical, legal and economic analysis, under the principle of independence that the LC mandates and distinguishes its actions, with the sole objective of protecting and ensuring competition in the country," reported the Superintendence of Competition (SC).
The request for authorization of economic concentration was presented, "consisting of the acquisition by América Móvil of control of the majority of Telefónica's capital stock in El Salvador."
At the end of January of this year it was reported that América Móvil bought 99.3% of Telefónica El Salvador, a transaction that reached close to $311 million.
The company reported that it sold all the shares of Telefónica Guatemala and 99.3% of Telefónica El Salvador to América Móvil for $648 million.
The Spanish company stated that the closing of the sale of Telefónica Guatemala took place on January 24, however, the sale of Telefónica El Salvador is subject to the relevant regulatory conditions.
Details from a report given to the Securities and Exchange Commission on the company's activities in the six Central American countries during the first quarter of 2014.
Operating revenues in Central America (Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, Panama) during the first three months of 2014 increased by 12.1% compared to the first three months of 2013. Adjusted operating revenue by 7.6%. This increase was mainly driven by the increase in wireless data, broadband and pay-TV services, offset by decreases in VOIP services.
With an investment of $1.1 billion it will connect to Brazil, Colombia, the United States, Guatemala, Mexico, Puerto Rico and the Dominican Republic.
The company announced that it has completed the installation of a submarine fiber optic cable which guarantee services. This project will connect Brazil, Colombia, the USA, Guatemala, Mexico, Puerto Rico and the Dominican Republic.
Costa Rica is the regional leader in 4G data consumption through mobile devices and 4G networks.
America Movil (Claro) and Telefonica (Movistar) agree that Costa Rica is the country with the highest data traffic in Central America, this is because it is the only country that does not charge for downloading data, but rather by the speed offered by providers.
In agreement with America Movil, AT&T will operate in 15 countries including all of Central America.
Expectations are that AT&T will today announce that it will "... extend its reach in Latin America for business customers through a cooperation with the firm America Movil, belonging to the Mexican billionaire Carlos Slim".
A system of 17,500 km of submarine cable, designed for 100 gigabits per second, will connect the U.S. to South America through Central America.
Alcatel Lucent and America Movil plan to put into operation, in late 2013, the system known as AMX-1, connecting seven countries with eleven landing points: Miami and Jacksonville (USA), Barranquilla and Cartagena (Colombia), Fortaleza Salvador and Rio de Janeiro (Brazil), Puerto Plata (Dominican Republic), Cancun (Mexico), San Juan (Puerto Rico) and Puerto Barrios (Guatemala).
After the competition regulator imposed the release of part of the spectrum leased by Claro as a condition to the merger between the two companies, America Movil has announced its withdrawal from the move.
In March last year, America Movil announced an agreement to acquire a 100% stake of Digicel El Salvador, for an undisclosed amount.
The Superintendency of Competition (SC) of El Salvador conditioned the operation to Claro waiving the right to exploit 20 MHz of the total spectrum it owns in El Salvador. "The reason for this precondition to authorize the merger of operations of both companies is to retain the current level of competition in the cell phone industry to protect consumers' pockets", explained at the time the head of the SC, Francisco Diaz Rodriguez .
The Mexican company will not be able to merge with Digicel unless it agrees to a condition to renouncen the use of 20 MHz of airwaves.
Regarding the ruling by Superintendencia de Competencia (SC), Daniel Choto writes in Elsalvador.com, "The reason for this precondition to allowing the merger of the operations of both companies is to maintain the current level of competition in the field of mobile phone companies in order to protect consumers' pockets, said the head of the SC, Francisco Diaz Rodriguez. "
Claro has asked the Superintendency to revoke its prior decision and "to consent without conditions to its consolidation operations."
The condition that Claro opposes, is the renouncement before the Superintendency of Electricity and Telecommunications (SIGET), of its right to operate 20 MHz of the total Salvadoran radio electric spectrum it has.
A press release by the Superintendency for Competition (SC) says:
The government of El Salvador requires the renunciation of the spectrums assigned to both companies individually, to avoid limiting competition.
The resolution by the Superintendency of Competition requires America Movil (Claro)"... give up some of the radio spectrum it has been assigned. This spectrum will be used by new competitors creating more competition and therefore consumer benefits".
O4Bi is a system that allows to control and manage what a company needs: the complete process of development of works, accounts receivable, treasury, banks, sales and accounting.
O4Bi is a very robust system that allows to control and...
español
2197
