Category: Regions

Mexican fixed-line phone operator Axtel has acquired local telecoms group Avantel for $500 million. Axtel will pay $310 million in cash and assume $190 million worth of net debt. Axtel said the acquisition would create a “fully complementary national telecommunications company in Mexico”, and added that the transaction was expected to generate “annualized synergies of US $40 million twenty-four months after the closing date”, which Axtel hopes will be the end of the year.

The Mexican government sold $184 million worth of peso denominated bonds Tuesday, making it the first Latin American country to sell local debt with such an extended maturity. The bonds sold to yield 8.08 percent and investors bid for 6.3 times the amount offered. The sale cements Mexico’s comeback from the 1994 devaluation that sent the economy into a tailspin. Local pension funds, which are restricted from investing a large portion of their portfolio in stocks, were likely the largest buyers.

Telefonos de Mexico, Mexico’s dominant phone company, said Tuesday it had purchased an 80 percent stake in a company that publishes Spanish language phone directories in the United States. The company did not disclose the amount it paid Cobalt Publishing LLC and Blue Equity LLC for the stake. Enlaces Spanish Yellow Pages will change its name to Seccion Amarilla USA to match the Mexican company’s domestic yellow pages division and gives the company access to the Hispanic market through print and Internet directories. Telmex mogul Carlos Slim has had mixed success in forays into the US market even as he has successfully expanded his telecom and industrial empire to the rest of Latin America.

The Venezuelan congress may seize plants belonging to Mexican bottler Coca-Cola Femsa unless former workers receive adequate severance pay, according to Iris Varela, a legislator close to President Hugo Chavez. Some of the pay claims date back to 1998, though Femsa said it has no further obligations to them, and has won all the related court cases. Workers, current and former, have blockaded all four of Femsa’s bottling plants in Venezuela, effectively closing down production since Monday. Femsa acquired the Venezuelan plants in 2003 when it bought PanAmerican Beverages Inc. for $3.6 billion.

Foreign investment in Mexico’s financial markets rose 4.35 percent in September to $138.61 billion, the highest ever amount. A stronger peso and a surge in stock prices that led to the market index reaching a record high with a rise of 4.22 percent during the month helped the figure. Foreign investors own 45 percent of all stocks traded on the local exchange.