Liberty Latin America has acquired Telefónica’s operations in Costa Rica for an enterprise value of US$500 million, pitting itself directly against the dominant local operator Instituto Costarricense de Electricidad (ICE).
This is Liberty’s second acquisition in the Central American country after purchasing a controlling stake in Cabletica in 2018.
“We have had great success in Costa Rica through our 2018 investment in 80%-owned Cabletica. This transaction comes at an attractive valuation, consistent with our disciplined approach towards M&A,” stated Liberty’s CEO Balan Nair.
With 2.3 million subscribers, Telefonica is the second-largest telecom operator in Costa Rica, with its LTE network covering nearly 90% of the country’s population.
Liberty will now combine Cabletica with Telefonica, creating what Nair calls “a leading integrated communications player” in the country.
Unlike Telefonica, Cabletica provides digital TV in addition to broadband internet and fixed-line phone services. At the time of this acquisition, Cabletica did not have a mobile offering and was largely competing with the likes of Cablevision, Tigo, and AT&T subsidiary DirecTV.
Spun off from Liberty Global, Liberty Latin America has operations in Chile, Puerto Rico, and several Caribbean countries. It operates under a variety of brands, including VTR, Flow, Más Móvil, and BTC, with its sub-sea and terrestrial fiber optic cable network connecting over 40 markets in the region.