Chile’s Entel to Buy Rival GTD

Chile’s Empresa Nacional de Telecomunicaciones (Entel) plans to acquire rival telecom company GTD Grupo Teleductos, in a deal that is still in the works. The move comes as Entel faces increasingly tough competition from the likes of Movistar, a unit of Spain’s Telefonica, and Claro, owned by Mexico’s America Movil. Entel will incorporate GTD’s assets into its operations and in exchange, GTD shareholders will control a 9.8% stake in Entel, worth some $436.86m using Tuesday’s CLP9,890 ($18.85) closing price of Entel’s ordinary shares. The memorandum of understanding that calls for an acquisition in coming weeks is being signed by GTD’s controlling holder Inmobiliaria e Inversiones El Coigue Limitada and Altel Limitada – owned by Almendral Telecomunciaciones which holds 54.8% of Entel. Officials from both telecom companies declined to offer additional details regarding the planned transaction or the financial advisors involved. Entel has a $4.46bn market capitalization, with a free float of some 236,523,695 shares. Last year, it generated Ebitda of around CLP67.5bn on the back of some CLP150bn ($285.8m) in revenues.