Almendral, local firm under Juan Hurtado Vicuña, taking over Entel may grant the local management of the operator – led by Richard Büchi; close friend to the buyer - some extra freedom to make strategic decisions. Thus, the firm has a wider setting for growth ahead.
Juan Hurtado Vicuña is the businessman with the widest presence in Chilean Boards. The said prestige lies on his personal success: he accrues investments in assets that total over US$ 3 billion. His activities are branched out among financial, health, mining, real estate and retail sectors. The core of his empire lies in his stakes in Consorcio Financiero, a holding owner of seven firms.
Hurtado Vicuña¿s business career is closely linked to privatizations started between 1985 and 1989 by Juan Büchi, Richard¿s brother. The former was at the time Treasury Minister under the military tenure led by Augusto Pinochet. Hurtado Vicuña had been appointed by Juan Büchi to define the financial profile of State-run firms set for sale, thus urging him to be involved in the Boards of Soquimich, Endesa, Chilectra, Chilmetro and Chilquinta. Towards the end of Pinochet¿s tenure, he also joined Aguas Quinta and Aguas Décima.
Through the former Chilquinta, now Almendral, Hurtado Vicuña arrived in Entel in 1992, after buying 19.99%. The entrepreneur then left in 2001, after selling 25.6% of his stake plus 3.5% under Grupo Matte, to Telecom Italia in some US$ 900 million, same amount that will now allow him to take over Entel. The figure itself reveals he has just made an excellent business, but the merit is even higher if taking into account that, to date, Entel has been gaining a stronghold in the mobile business through Entel PCS; in addition to the fact that the toughest phase for infrastructure rollout has been concluded already. The latest rate decree, which has basically cut end prices and increased interconnection rates, has had a negative impact on the corporate quotation, though there are expectations on assets revaluation that will also favor Hurtado Vicuña.
Though Telecom Italia¿s decision of leaving Chile seems quite hasty, it will allow the firm to cut its corporate debt in almost € 1.1 billion. This sale to a local group, as in 2004 with the firm¿s departure from Venezuela, gives another tip: Italians don¿t sell to either Mexican or Spanish. Several sources pointed that, in 2004, Carlos Slim had offered more than what Almendral had offered for Entel.
Holder changes are to come in the next three months, thus implying no alterations in Entel¿s helm. The firm has been led by Richard Büchi since 1994, way before Telecom Italia¿s arrival in Entel. Besides his personal relationship with Hurtado Vicuña, Büchi¿s long-standing career grant him enough merit to stay. The executive kept a tense relationship with the Italians that, lately, were quite reluctant to pass strategic plans the Board filed. Entel Chile¿s main bet on fixed telephony lies on last-mile deployment, with huge expectations if migration to Wi-Max is completed. In mobiles, it now has to face the new Telefonica Movil-BellSouth Chile that serves 48% of the Chilean market.