Carlos Slim's América Móvil Says It's Not Interested In Buying T-Mobile

Dolia Estevez

Contributor

Deutsche Telekom , which owns nearly 67% of T-Mobile, is reportedly looking for a buyer for the U.S. cellular company, according to Germany’s Monthly Manager Magazin, saying that América Móvil(NYSE:AMX), controlled by billionaire Carlos Slim Helú, was a possibility.

Citing people familiar with Deutche Telekom, Manager Magazin Online reported last week that the Mexican operator would be a good candidate for T-Mobile since it already has a presence in the U.S. through TracFone. While TracFone offers mobile services, it does so via a mobile virtual network operator (MVNO) agreement and does not own networks of its own. Deutsche Telekom and América Móvil could jointly build up the business, the magazine suggested. A spokesperson for Deutsche Telekom declined to comment, other than to say that the German operator is under no pressure to sell T-Mobile US.

But América Móvil was quick to deny the story. “It’s false,” Arturo Elías Ayub, Slim’s spokesperson told me when I asked him by email if there were talks with T-Mobile. América Móvil Chief Executive Daniel Hajj also said in a conference call on Friday that the company was not talking to anybody about a possible purchase of T-Mobile US, Reuters reported.

(Photo credit: AP photo/Christian Palma)

Meanwhile, América Móvil posted its quarterly earnings results on Thursday, missing expectations as taxes and exchange rate losses rose. América Móvil reported that its third-quarter net profit fell 38% compared with a year earlier. The company said net profit in the July-September period fell to 10.12 billion pesos ($754 million) from 16.38 billion pesos a year earlier.

America Movil’s tax burden rose by 4.43 billion pesos versus the same quarter last year, while it posted an exchange rate loss of 8.97 billion pesos.

Analysts had expected the company to report a net profit of 16.47 billion pesos, according to a Reuters poll. Earnings before interest, tax, depreciation and amortization were slightly above expectations.

Revenue rose 14% to 220.884 billion pesos, principally due to the consolidation of Telekom Austria , of which América Móvil now owns almost 60%, into the results for the first time, Reuters said.

The new zero interconnection rate for traffic from other operators caused a 5.5% drop in Mexico wireless service revenues in the third quarter, the company said.

Under the new Mexican antitrust telecom regulations, América Móvil is in the midst of a major regulatory crackdown in Mexico, which began to drag down its results last quarter, particularly in wireless voice revenues

In response to the regulations, América Móvil said in July it would reduce its phone market share below 50% as the new law mandates. Currently, América Móvil controls 70% of the mobile phone market on Mexico and 80% of landlines.

Yet América Móvil’s stock price has risen around 20% since the announcement in July. The increase made Carlos Slim reclaim the world’s richest man title fromMicrosoft MSFT +0.28% (NYSE:MSFT) cofounder Bill Gates, which he has now lost again, according to Forbes estimates.

Gates is the richest person in the world, with a net worth that Forbes estimates at $81.2 billion, followed by Slim with an estimated net worth of $79.5 billion.

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