Telecom Argentina and cable TV provider Cablevision have announced a deal to merge their operations with a view to moving into the quad-play market ahead of a forthcoming regulatory shake-up. In a joint statement the companies said the respective boards have agreed that Telecom Argentina will issue 1.184 billion shares as part of the deal, leaving Cablevision shareholders with 55 percent of the combined entity. If approved by regulators and shareholders, the deal would allow the two broadband providers to offer fixed line and mobile services as well as pay-TV in time for the opening of the local telecommunications sector set for January 2018.
Cablevision is a subsidiary of media giant Clarin, which was spun off into a separate unit last year. It is also part owned by Fintech, the investment firm of Mexican financier David Martinez Guzman which finally completed its acquisition of Telecom Italia's controlling stake in Telecom Argentina last November. "The combination of the two companies will strengthen their investment in modern, mobile technology infrastructure as well as the build out of a high speed fibre optic network," said the firms in the statement announcing the merger deal.
If it receives corporate and regulatory approval, the merger would give the new firm a 55 percent share of the local broadband market, putting pressure on rivals such as Claro (America Movil) and Telefonica. Telecom regulator Enacom last year approved Telefonica Argentina's request to change its statute to allow it to provide TV services but the company has repeatedly accused the Argentinian government of favouritism towards Clarin.
