América Móvil is not planning any further significant injections of cash into its ClaroVTR joint venture in Chile after becoming the major shareholder.
“Since the beginning, when we did the [JV], we made a plan and in that plan we incorporated some cash into the company,” CEO Daniel Hajj said during an investor call to discuss 2Q24 results.
America Móvil and its partner Liberty Latin America agreed to capitalize the JV in Chile for 972 billion Chilean pesos (US$1bn), of which América Móvil contributed 721bn pesos. As Liberty Latin America decided to contribute less, America Móvil will gain control of 91% of ClaroVTR.
“We’re comfortable with the equity, the way the, financially, the company is going to end … this year,” he added.
CFO Carlos García Moreno underscored that “going forward… we don’t expect any major cash injections into Chile.”
He also said that capex in Chile would be almost fully funded by its own Ebitda and “maybe over the next couple of years, we will have a company that’s fully self-sufficient.”
“I think, at the end of ’24, we’re going to have the company fully capitalized,” Hajj added.
The América Móvil CEO said that the company is on target to achieve the three-year plan defined in 2022 with Liberty Latin America, with the company having achieved full integration of VTR and Claro and working on the optimization of resources, generating “important operating synergies.”
On the mobile side, the company expanded its coverage footprint by adding 1,200 new sites and upgrading its network to provide 5G services.
Claro Chile was awarded 50MHz of 5G spectrum in the June 5G spectrum tender and will begin the rollout shortly.
Regarding its fixed line platform, the company is in the process of migrating customers to FTTH through a longstanding commercial agreement to lease capacity from OnNet.
As of June 30, ClaroVTR had 2.7mn fixed line RGUs, including 1.4mn broadband accesses and 5.1mn wireless subscribers.
“It’s a very competitive market, with four players in mobile and maybe more in fixed,” Hajj said. “We have the right size right now because before we only had mobile revenues, and they’re not so high. Today we’re a more than US$1bn company. I think it’s US$1.2bn. We have the size and I think we’re going to be successful in Chile.”
WOM
Hajj also said that the company is open to looking at the opportunities regarding troubled telco WOM. The mobile company has filed for Chapter 11 bankruptcy in the US and this week a Delaware state bankruptcy court approved a settlement that includes a bidding process for the debtor’s assets.
“We are open to see what the alternatives are,” Hajj said when asked about WOM during the investor call. However, he added that it is not clear whether the company will be involved in any M&A deals.
In March, Claro was ranked fourth in mobile internet, with a 17.3% market share, plus VTR’s 1.4%. Entel led the way with 35.1%, WOM had 25.2% and Telefónica Movistar 20.3%, according to the latest data from regulator Subtel.
Source link : https://www.bnamericas.com/en/features/america-movil-not-planning-further-major-cash-injections-in-chile
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Publish date : 2024-07-17 17:55:00
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