Maxcom Telecomunicaciones' move to restructure the company and hand control over to private equity firm Ventura Capital Privado prompted a share jump of 18 percent to 5.24 pesos at the close of trading in Mexico yesterday.
As part of its agreement with Ventura and other related entities, Maxcom said that Ventura and related parties will offer 2.90 pesos a share for the service provider and contribute $45 million in capital. Maxcom said this agreement will "significantly reduce" its debt service expense and position it for growth.
In addition, bondholders that represent $84 million of Maxcom's $200 million in notes agreed to a Chapter 11 bankruptcy plan that includes a swap for debt maturing in 2020.
This latest restructuring gives Maxcom another shot at challenging the country's dominant telco Telmex, America Movil's (NYSE: AMX) wireline subsidiary. Last December, Maxcom agreed to be bought out by private equity firm Ventura for $59 million, move debt holders rejected this April.
Maxcom still has a long way to go before making a significant dent in Mexico's wireline industry. Today, Maxcom only has a 5 percent of Mexico's wireline market, far less than the 80 percent incumbent Telmex has.
- see the release
- Bloomberg has this article
Mexico may lift foreign ownership cap on telcos
Ventura Capital Privado to acquire Mexico's Maxcom for $59M
Telmex faces anti-trust allegations