América Móvil to Shed Assets, Loosening Grip

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América Móvil has also agreed to give up the option to acquire Dish, whose satellite dishes dot Mexico City roofs.Credit Carlos Jasso/Reuters

América Móvil, the Latin American telecom giant, said Tuesday that it would sell off parts of its Mexican unit, an unexpected capitulation by its controlling shareholder, Carlos Slim Helú, to strong new antimonopoly rules.

The announcement, which could set off a shake-up in Mexico’s stagnant telecommunications industry, was a victory for regulators after years of failed efforts to rein in the dominance of Mr. Slim’s company.

It came just as Mexican legislators approved new laws governing Mexico’s telecommunications and broadcasting industries. The laws are intended to open Mexico’s telephone and media markets, which have long been quasi monopolies, and attract billions of dollars in new investments from competitors.

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Carlos Slim Helú controls América Móvil, which said that it would sell parts of its Mexican unit.Credit Christian Palma/Associated Press

Last year, the government of President Enrique Peña Nieto agreed with the opposition on constitutional changes to overhaul those industries, part of a broader effort to rein in monopolies that economists believe hold back Mexico’s growth.

The changes are a central part of Mr. Peña Nieto’s ambitious agenda, which includes opening up the energy industry to private investment. His hope is that his plans can jump-start three decades of torpid growth.

The laws approved Tuesday flesh out the details of last year’s constitutional change. Opposition politicians and many analysts said that the final rules were much tougher on América Móvil than on Grupo Televisa, a broadcaster that dominates television in Mexico and is seen as crucial to elevating any politician’s profile. (Mr. Slim owns a 17 percent stake in The New York Times Company.)

In its announcement on Tuesday, América Móvil appeared to concede to a March ruling by a powerful new regulator, the Federal Telecommunications Institute, that said the company was dominant because it controlled more than 50 percent of the market.

The regulator made a similar ruling for Televisa and ordered both companies to take steps, including sharing their infrastructure with competitors, to open up the markets.

América Móvil said it would sell assets — which it did not describe — to an outside company so that its holdings would fall to less than 50 percent of the telecommunications market.

It also said that it would sell its cellphone towers and give up its option to acquire a majority in a satellite pay-television company called Dish that has 30 percent of the market.

Although the announcement by América Móvil showed the strength of the regulator’s ruling, opposition legislators and analysts questioned parts of the new laws that they said would ultimately weaken their force and could even scare off investment.

The laws reduced much of the autonomy of the new regulator. They hand back to the federal government the authority to interpret the law, said Judith Mariscal, a telecommunications expert at the CIDE, a Mexico City research institute. “That’s a big thing,” she said.

Without a strong, autonomous regulator, “that generates uncertainty for investment,” Ms. Mariscal said.

Eli Noam, a telecommunications expert at Columbia University who has studied concentration in telecommunications markets, said that Mexico is by any measure “extraordinary” for how little competition there is.

But he had high praise for the new Federal Telecommunications Institute’s commissioners. “This is a really strong group,” Mr. Noam said, adding that the government may have regretted losing control. “It seems that the government has had second thoughts: Oh my God, what have I created.”

The government hopes that the new law will add an additional $19 billion to $23 billion in telecommunications investment over the course of Mr. Peña Nieto’s six-year term, which ends in 2018.

An estimated $10 billion of that will be to provide service through a publicly owned telecommunications network the government will begin to lease this year, said José Ignacio Peralta, Mexico’s under secretary of communications. It is a novel business model in the industry, he said, but the strong concentration in Mexico’s industry meant that “we have to invent new solutions.”

He pointed to the recent entry of Virgin Mobile into the Mexican market as evidence that the overhaul’s incentives to competition were beginning to work.

The lower house approved the law Tuesday, with the ruling Institutional Revolutionary Party joined by most of the conservative National Action Party. The Senate passed the law on Saturday.