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Non-Tech : TMX ready to take-off? -- Ignore unavailable to you. Want to Upgrade?

To: md1derful who wrote (83)	6/23/1999 11:34:00 AM
From: Steve Fancy	Respond to of 92

Telmex could see $107 mln profit after AT&T pact Reuters, Tuesday, June 22, 1999 at 19:38 By Veronica Galan MEXICO CITY, June 22 (Reuters) - Telmex (MEX:TELMEXL), Mexico's dominant telephone company, could see a $107-million profit in back fees during the current quarter, after coming to an agreement with AT&T Corp. over international connection rates, analysts said on Tuesday. Under the accord, signed on Monday after two years of wrangling, AT&T (NYSE:T) agreed to pay Telmex (NYSE:TMX) a so-called settlement rate of 37 cents a minute for all calls placed from the AT&T network to Telmex's network in Mexico during 1998. AT&T has already paid an average of 19 cents for each call it sent to Mexico during 1998, and analysts said $107 million was the difference due. Gerardo Copca, an analyst with Valores Finamex brokerage, told Reuters that the $107 million would go directly to the balance sheet as a profit, since Telmex has already reported expenses from the time period for which that money was due. "I don't know whether they will record it as an extraordinary earning or as income," he said. Under the accord, Telmex will also charge settlement rates of 31 cents per minute for calls placed during the first half of 1999 and 19 cents per minute from July 1, 1999 through the end of 2000. MCI WorldCom (NASDAQ:WCOM), another U.S. long distance operator that has been haggling over settlement rates with Telmex, said it expected to come to a similar agreement with Telmex in the next two weeks, possibly adding another $40 million to Telmex's profit for this quarter or next. "As soon as MCI signs, it would be another $30 million to $40 million," said Ilana Treston, an analyst with Merrill Lynch. Analysts said the accord could also signal that Telmex is also ready to resolve conflicts with its Mexican long-distance competitors Alestra, partly owned by AT&T, and Avantel, in which MCI has a stake. "I don't want to make a direct connection, but it's all part of ongoing negotiations between Telmex, Avantel and Alestra to settle all kinds of outstanding issues," Treston said. The Mexican telephone industry is in the middle of a legal battle in which Telmex, which operated without competition until 1997, is trying to avoid being forced to provide information to its competitors and lose its competitive edge, after the government monopoly watchdog recently declared that it was the "dominant" telephone company in the country. mexicocity.newsroom@reuters.com)) Copyright 1999, Reuters News Service

To: md1derful who wrote (83)	7/12/1999 1:09:00 PM
From: Steve Fancy	Read Replies (1) \| Respond to of 92

Telmex, MCI sign pact on settlement rates Reuters, Friday, July 09, 1999 at 21:15 MEXICO CITY, July 9 (Reuters) - Ending a two-year battle over fees to connect calls between the United States and Mexico, telephone giant Telefonos de Mexico (Telmex) (NYSE:TMX">NYSE:TMX)(MEX:TELMEXL) said on Friday it reached an agreement with MCI WorldCom (NASDAQ:WCOM) (NASDAQ:WCOM). "Telefonos de Mexico announced today that it signed an agreement with MCI WorldCom to reduce settlement rates between Mexico and the United States," the company said late Friday in a news release made through the Mexican stock exchange. International settlement rates are the fees that U.S. phone operators pay Telmex to end calls in Mexico. The fees are generated when Telmex finishes more calls in Mexico for MCI than it asks MCI to finish for Telmex in the U.S. The agreement, which finalizes a preliminary accord made in March, sets a retroactive rate of $0.37 per minute for calls made in 1998, and a rate of $0.31 per minute for calls made during the first half of 1999. For the period July 1, 1999 to the end of 2000, the rate will be $0.19 cents per minute. The rates are the same as those that Telmex agreed with AT&T Corp. (NYSE:T) in June. Telmex said it hoped the new 19-cent rate would reduce bypass, which is when long distance companies avoid paying the settlement rate by passing calls over the border, then feeding them into the Mexican system disguised as local calls. The 37-cent rate stimulated bypass because it was so much higher than the interconnection fee for local calls. Telmex and other Mexican long-distance operators say they have lost hundreds of millions of dollars this year and last because of bypass. A former government-owned monopoly, Telmex was privatized in 1990. In 1997 Mexico's long-distance market opened up to competition. Telmex's main long-distance competitors are Alestra, which is associated with AT&T, and Avantel, which operates with MCI. In a report in June, Salomon Smith Barney telecommunications analyst Patrick Grenham estimated that Telmex could receive $30 million in back payments for what MCI WorldCom owes to the Mexican company for settlement fees. mexicocity.newsroom@reuters.com)) Copyright 1999, Reuters News Service