Suitors for America Movil’s (AM’s) surplus assets in Mexico will have to prove they are completely independent from the Carlos Slim-controlled group, beyond simply making sure there are no direct financial ties, Bloomberg reports, citing Instituto Federal de Telecomunicaciones (Ifetel) president Gabriel Contreras. The official noted that historical relationships and personal ties will be scrutinised ahead of any deal, in a statement which is likely to give AT&T Inc – the nominal front-runner in the quest to buy AM’s assets – pause for thought.
Earlier this year AT&T cut its financial ties to AM – selling its minor stake in the Mexican group after 24 years – in a bid to avoid antitrust hurdles relating to its ongoing acquisition of satellite broadcasting giant DirecTV, but questions remain over the US company’s strong historical links to Slim and his companies. Contreras told the news agency: ‘Whether there’s been history or not, of course, is something we have to study. [We need] to verify if it’s something that subsists or not, apart from whether there have been any corporate or capital changes. It would be pointless if whoever serves that portion of the market responds to the same common interest, or even colludes. [We have to rule out] overlap between board members or at management levels.’ Bloomberg notes that current AT&T board member Jaime Chico Pardo previously served as the CEO of Slim’s Telefonos de Mexico from 1995 to 2006, suggesting a clear conflict of interest.
As previously reported by TeleGeography’s CommsUpdate, Slim is ready to sell off parts of his Mexican telecoms business in an effort to cut his company’s market share across the sector to below the 50% mark, thus avoiding regulations that apply only to dominant players, and cease being a ‘preponderant economic agent’. Last month it was reported that AM had contacted four potential suitors – AT&T, Softbank Corp of Japan, Bell Canada and China Mobile – with a view to selling Telmex and Telcel in a deal worth up to USD20 billion.
One company that definitely will not be bidding for AM’s assets is Verizon Communications. CFO Fran Shammo told the Wall Street Journal that Verizon has ‘no interest’ in acquiring the assets, adding that Verizon is not interested in any other major deals elsewhere in the world either.