Alliances Map in Argentina 2017 - Credit: © 2017 Grupo Convergencia
The Cablevisión + Telecom megafusion changes the competitive ICT scenario in Argentina. At the close of this edition, on 12/14/17, it was announced that Personal, Sofora and Nortel will be absorbed by the new company. On the other hand, it had not yet been approved by Enacom or the National Commission for the Defense of Competition. The regulators assure that they will take the time that is necessary to analyze the integration. Arnet and Cablevisión account for 55% of the fixed broadband market, there is geographical overlap of both networks and they have 240 MHz of spectrum. The merged company will have 3.9 million fixed lines, 19.5 million mobile lines, 4 million broadband accesses and 3.5 million cable TV users.
There is little doubt that the hosts of Hector Magnetto will achieve all their objectives. Until now, the government gave Grupo Clarín what it requested. The parties agreement enables Cablevisión to lead the merged company.
Cablevisión Holding has a purchase option from Fintech and would acquire a 13.51% stake in the merged today in the hands of the investor group. In the Map of Alliances 2017 it is visualized how the megafusion will be when this operation is executed. In addition, in the Map, it is included with a line of points to Personnel and to the "preferred shareholders of Nortes", that will become part of the concentrated one.
Cablevisión has already taken out a loan for US $ 750 million with the objective of making an advance payment and becoming the majority shareholder of the megacompany with 39.1%. Fintech would remain with 31.7% of the values ??(the announcement of November 14 says it will have 35.19% and thus appears in this Map), Nortel with 9.2% and 5.18% as floating capital , according to the holding company.
In March 2017, Fintech acquired all the shares of Sofora, which controls Nortel Inversora, and Grupo Werthein no longer appears on the Map. Nor is Sofora, subsumed in the "preferred shareholders of Nortel."
A striking and even controversial case is what happens with the actions that the Argentine State has in Telecom through Anses. Until the merger, it had a 25% stake. As capital increases, as a result of the merger, the State will remain with only 11.4%. However, it maintains 9% of the shares in Grupo Clarín. Cablevisión Holding already started trading on the Buenos Aires Stock Exchange and could continue to expand the company with alliances and movements to enter other markets, such as satellite.
With respect to Grupo Clarín, the Dominio Group, made up of the heirs of Ernestina H. de Noble together with Héctor H. Magnetto, José Antonio Aranda and Lucio Rafael Pagliaro, owns 80%. This new composition is the result of the purchase of the shares of the Booth investor that owned 9% after the spin-off of Cablevisión Holding.
At the end of October there was a new surprise. Grupo Indalo was sold and will go to the investment fund OP Investments if the Justice approves the operation. The objective of the buyer, OP Investments, would not be focused on the media conglomerate but on other assets, especially oil companies. Therefore, channel C5N, Radio 10, newspaper Ámbito Financiero and FM Vale 97.5, Mega 98.3 and Pop Radio 101.5, among others, could be sold together or separately. For the Government the atomization of the media group - with independent and / or opposing views - is Bingo!
Fútbol para Todos disappeared and in its place were added the two new signals from Turner and Fox: TNT Sport and Fox Sport Premium. The two international companies paid more than $ 17,000 million until 2022 for the transmission rights of the Superliga.
The promised Convergent Law will remain in limbo. The sector is governed by resolutions and decrees. It is expected, however, a new regulation, although there could be two: a law for infrastructures and another for service. At the end of the year, the Ministry of Communications ceased to exist and the ICT Secretariat moved to the Modernization portfolio. Arsat, Enacom and the Post went to the orbit led by Andrés Ibarra.
The changes registered in the last year plus others that may occur, would lead to a scenario of greater concentration of companies. Market players must build profiles and alliances to compete with the mega company. In January 2018 the convergence of services was enabled, triple or Nplay, initially in the AMBA, Córdoba and Rosario. There are certainties that the Government allows Claro and Telefonica to provide satellite television service (DTH) to look for some competitive equilibrium in Pay TV.
These two major players understand that it is the only way to compete in the whole territory in a transition stage with the new giant, while advancing with fiber lines. They are able to invest for the new business, have experience in other countries in the region with DTH and could also add Arsat as a partner.
Rumors abound about possible buy-sell companies. These are the cases of DirecTV, Supercanal, Telecentro, Giga Red, among others. Small and medium-sized companies are not excluded from probable acquisitions. Entrepreneurs also analyze new alliances to strengthen themselves in a market in which competition is complicated.