Emerging markets telecom group Millicom International Cellular SA has agreed to merge its Colombian operation with regional fixed-line operator Empresas Públicas de Medellín in a bid to provide a complete range of digital services in the Andean country. Colombia’s telecom regulator has yet to approve the deal and the companies expect the transaction to be closed sometime in the middle of next year.
“Provided this process concludes positively, we expect the transaction to complete by the end of H1 2014,” the telcos stated in a press release. Millicom said the merger was part of its broader strategy to double revenue by 2017 and increase profits.
The carrier operates under different brands in Latin America, including its Honduran unit Tigo, which recently won a license to launch 4G services. Analysts say the merger will help the carriers to reach out to customers all around the country and offer bundled services – including fixed and mobile telephony, broadband and pay TV.
The talk about the merger first surfaced in July, but the official agreement was only signed last week after several rounds of negotiation between company executives.
“It brings even closer the prospect of creating an exciting new business to provide a complete range of digital services to the people of Colombia,” said Hans-Holger Albrecht, Millicom President & CEO. “Meanwhile, we will work hard with the Colombian authorities to provide all the information they need to assess the proposed merger.”
Headquartered in Luxembourg, Millicom operates in 15 countries, employs more than 10,000 people and serves over 47 million customers. In 2012, the carrier generated $4.81 billion in annual revenue. Revenue in South America in the third quarter of 2012 was $480 million, up 14.6% year-on-year in local currency.