Mexico's Axtel, Alestra merger completed

Mexican ICT company Axtel said its merger with IT provider Alestra has become effective.

The company said it has begun a post-merger process to integrate and optimize its network infrastructure, systems, commercial offers and organization. The process is estimated to be completed within 18 months, when it is expected to capture up to 1bn pesos (US$53mn) in synergies annually.

Additionally, the company has estimated Capex synergies of US$20mn and annual interest savings of US$38mn from the refinancing of Axtel's debt.

The company said it will offer enterprise services under the Alestra brand, while serving the residential and small businesses segment through the Axtel brand.

The merger had been considered the best option for Axtel for some time, since its position in the market has been declining.

The merger process will also include downsizing. "There will definitely be a reduction of personnel, but we're not expecting the biggest synergies there," Axtel co-chairman Álvaro Fernández Garza was quoted as saying by daily El Financiero.