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Liberty Latin America betting on JV with Claro in Chile

Bnamericas

Liberty Latin America is betting on consolidation in Chile as result of the joint venture agreement with Claro.

The JV’s regulatory approval process should be completed by the second half of 2022, CEO Balan Nair told the company's Q3 investors conference.

“We think it makes sense for a country like Chile, where the combined company will be the third largest operator, behind Entel and Telefónica. Hopefully, it will also be a catalyst for further consolidation in the market,” Nair said.

Liberty Latin America's VTR is leading the pay TV market and the local fixed broadband market, the latter with 31% at end-June, according to regulator Subtel. However, the company has been losing market share to Movistar (Telefónica) and Mundo.

Entel leads the mobile internet market with 35.4%, followed by WOM (29.9%), Movistar (21.9%) and Claro (12.3%).

“We are combining a strong fixed operation with a strong mobile operation. We plan to deploy more fiber to the home, improve 5G coverage, strengthen our offer to the market and digital channels,” said Nair.

He said the JV could partner with other operators on network issues but did not provide details.

In Chile, On*Net, owned by Telefónica and KKR, offers fiber optics wholesale services to the home.

Liberty Latin America is also advancing the acquisition of Claro in Panama, where it aims to improve synergies and wants to invest US$500mn after the transaction.

These announcements, together with the acquisition of Movistar Costa Rica and the integration of operations in Puerto Rico, will increase integration costs for the next financial reports, the company said. But synergies will also be important.

RESULTS

Liberty Latin America reported growth of its subscriber base thanks to the deals involving C&W Panamá and C&W Caribe.

In the third quarter of the year, they added 84,000 income generating units, while the company added 74,000 subscribers in the mobile sector.

The company reported the highest growth this the year for the fixed segment. It continues with fiber optics investments and added 600,000 homes to its network this year.

B2B services also recovered after the COVID-19 pandemic.

The company reported cash flow of US$149mn and expects to exceed this year’s US$200mn target. Third quarter revenues were US$1.19bn, an annual increase of 34%, while Oibda was US$446mn, up 24%.

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