Get 40% Off
🚀 AI-picked stocks soar in May. PRFT is +55%—in just 16 days! Don’t miss June’s top picks.Unlock full list

UPDATE 2-China-backed bid wins Mexico tender for major telco network

Published 2016-11-17, 03:43 p/m
© Reuters.  UPDATE 2-China-backed bid wins Mexico tender for major telco network
MS
-
AMX
-
ALFAA
-
AXTELCPO
-
MEGACPO
-

(Writes through with more context and details)

By Christine Murray

MEXICO CITY, Nov 17 (Reuters) - Mexico has declared a Chinese-backed group winner of a tender to build and run a multi-billion dollar wholesale mobile network, the first major new investment announced in the country since Donald Trump's U.S. election victory.

The contract award marks the end of a saga over the ambitious tender, which was delayed several times, disputed by one participant and finally left to just one bidder.

The winning group, Altan, counts a fund managed by Morgan Stanley (NYSE:MS) Infrastructure, part of Morgan Stanley MS.N , as its largest shareholder, with 33.38 percent.

Second-largest is the 23.36 percent stake held by the China-Mexico fund created by the two countries in 2014, managed by a unit of the World Bank's International Finance Corporation.

The planned investment comes as uncertainty clouds Mexico's relations with the United States after Trump's victory. The brash real estate tycoon has threatened to radically shake up trade ties between the two neighbors at Mexico's expense.

Altan, which has already raised $750 million from its investors, promised in its bid that the network would cover 92.2 percent of the population within seven years.

The government has estimated 85 percent coverage would require an investment of some $3.5 billion, and 95 percent around $7 billion.

The network is the second investment by the China-Mexico fund, which has raised $1.2 billion to date.

China has provided $1 billion of that, of which $700 million comes from sovereign wealth fund China Investment Corporation, with the rest from China Development Bank, a person familiar with the matter said, speaking on condition of anonymity.

China's President Xi Jinping is currently embarking on a trip to Latin America. Visiting Chile, Ecuador and Peru, he is due to speak at the Asia-Pacific Economic Cooperation (APEC) summit in Lima on Saturday.

Mexico's government had to tender the shared network under a 2013 telecoms reform aimed at curbing the dominance of Carlos Slim's America Movil AMXL.MX . the winner, Altan will get cheap use of high quality spectrum in the 700MHz band and a 20-year public-private partnership contract to build a 4G LTE mobile network that operators and virtual network operators can rent.

Earlier this month, the government disqualified the only other bidder Rivada for not presenting the bid bond on time. Rivada disputed the decision. Altan consortium also includes Canada's second-largest pension fund, Caisse du Depot et Placement du Quebec, Mexico's Megacable MEGACPO.MX and conglomerate Alfa's ALFAA.MX unit Axtel AXTELCPO.MX .

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.