Mexican telecoms operators Axtel and Alestra have agreed to merge their operations, in an effort to remain competitive, the Wall Street Journal reports. Axtel has revealed that it has signed a memorandum of understanding (MoU) with Alestra’s parent company, Monterrey-based industrial conglomerate Alfa, to join the two companies, and plans to issue shares equivalent to 51% of the combined entity to Alfa in order to seal the tie-up. The companies said the transaction is expected to close at the end of this year or in early 2016. Going forward, the enlarged operator is expected to generate pro forma annual revenues of around MXN15 billion (USD889 million).
Axtel offers fixed line services, including telephony, broadband and pay-TV. At the end of December 2014 Axtel reported 908,000 fixed voice customers, down from 936,000 year-on-year, and a peak of 1.043 million in 2010. Alestra, meanwhile, focuses on corporate customers, and its key areas of business include its data centres and its cloud computing and consultancy services.