MEXICO CITY, Mexico and DENVER, USA - América Móvil S.A.B. de C.V. (BMV: AMX, NYSE: AMX and AMOV) is set to take a controlling interest in ClaroVTR, a joint venture with Liberty Latin America Ltd. (NASDAQ: LILA and LILAK, OTC Link: LILAB), following the latter's decision not to meet funding commitments.
As a result, América Móvil's convertible notes will be transformed into equity, giving it approximately a 91% stake in ClaroVTR, while Liberty Latin America will retain about 9%.
The transition, expected to finalize in the third quarter of 2024, comes after Liberty Latin America opted not to exercise its right to catch up on funding commitments by mid-year, which would have maintained its equal partnership in the venture. The upcoming shareholders' agreement will reflect the new equity distribution, with América Móvil assuming a majority governance role.
Daniel Hajj, CEO of América Móvil, expressed enthusiasm about the future of ClaroVTR, citing the strong foundation built with Liberty Latin America and anticipating continued success in serving customers with top-tier products and services.
Balan Nair, CEO of Liberty Latin America, also affirmed confidence in the decision, emphasizing the strength of ClaroVTR's management and the positive long-term outlook for the business despite current market challenges.
The consolidation of ClaroVTR into América Móvil's operations is subject to approval from Chile's National Economic Prosecutor's Office. Neither company has disclosed financial terms of the conversion of notes to equity.
This move reflects América Móvil's strategic positioning within the telecommunications industry and its ability to adapt to dynamic market conditions. The information for this report is based on a press release statement.
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