Verizon, Vodafone Sell 74% Of Iusacell To Movil@ccess
Monday July 28, 7:41 pm ET
MEXICO CITY -(Dow Jones)- U.S. phone company Verizon Communications Inc. and Vodafone Group Plc of the U.K. completed on Monday the sale of their controlling stake in Mexico's third-largest wireless phone carrier to local magnate Ricardo Salinas Pliego.
Both companies, which owned a combined 74% of Grupo Iusacell SA , sold their stakes for about $7.4 million to Movil@ccess SA , a paging concern that forms part of Salinas Pliego's group of companies.
Biper, the parent company of Movil@ccess, said in a filing with the Mexican Stock Exchange late Monday that it purchased close to 1.38 billion shares for about 0.06 pesos ($1=MXN10.4620) apiece.
"The control of Iusacell is now guaranteed," an executive familiar with the transaction told Dow Jones Newswires.
Last month, Salinas Pliego launched a tender for all of Iusacell's shares for $10 million plus the assumption of $815 million in debt.
The sale represents the exit from Mexico of Verizon and Vodafone after investing around $1 billion each in a market that once looked promising and that now is mostly in hands of local giant America Movil SA , and Spain's Telefonica Moviles SA .
Verizon, which owned 39.4% of the company, and Vodafone, which had another 34.5%, rejected three higher unsolicited bids submitted by Iusacell creditors UBS Securities LLC. and Fintech Advisory Inc.
Both companies rejected the latest $40 million bid from distressed debt investor Fintech partly because it lacks experience in operating a telecommunications company, according to a Iusacell statement submitted to the Mexican Stock Exchange earlier in the day.
According to Iusacell, Fintech holds about $35 million of its debt. The distressed debt investor has threatened to trigger early repayments on defaulted bonds, as Iusacell already missed payments in June.
A full count of Movil@ccess' tender offer is expected to be completed after the offer is closed in the U.S. late Tuesday.
The top management and board members of Iusacell have already resigned and have been replaced by Salinas Pliego appointees.
Salinas Pliego also has been named Iusacell's chairman. His broadcaster TV Azteca SA holds a 46.5% in Unefon SA (E.UFN), the country's fourth-largest wireless phone carrier. That creates potential synergies if Iusacell tries to regain market share.
A long restructuring process is now expected, as the company's debt will be assumed by Salinas Pliego, a savvy investor with a reputation of being a tough negotiator.
Fintech officials couldn't be immediately reached for comment.
Related Websites:
iusacell.com.mx
biper.com.mx
-By Santiago Perez, Dow Jones Newswires; (5255) 5080-3451; santiago.perez@dowjones.com |
