America Movil, the huge Mexican telecommunications firm founded by billionaire Carlos Slim, is to break up its empire.
The firm announced asset sales yesterday following regulatory reforms that could spell the end of the company’s dominant position in Mexico’s telecommunications market.
The company said in a statement it would sell assets to reduce its national market share in the Mexican telecommunications market to below 50 per cent, to avoid being punished for being a dominant player under new regulations to boost competition.
America Movil currently has approximately an 80 per cent share of the landline market in Mexico through its Telemex subsidiary, and a 70 per cent share of Mexico’s mobile market through its Telcel subsidiary.
The reforms have been pushed by Mexican President Enrique Pena Nieto, and may also hit Televisa, which has above 60 per cent of the free-to-air TV market. America Movil could benefit from this as it may be given the go-ahead to move into the pay TV sector, from which it has been barred up to now.
Carlos Slim built his telecommunications empire from the purchase of Telemex after its privatisation in 1990.
The huge success of his companies led Slim to become the world’s richest man between 2010 and 2013.