Argentine company looks to cash in on presidential decree
BUENOS AIRES — Grupo Clarin is in talks to sell as much as 49% of its cable operator Multicanal, and U.S. players are believed to be front-runners.
Its J.P. Morgan/Credit Suisse-led IPO apparently on ice, Multicanal wants to secure both capital and expertise to take advantage of a presidential decree that cable companies may offer telephone services beginning in November 1999.
With 1.6 million subscribers (not counting minority-owned systems), Multicanal claims to be Latin America’s largest MSO.
Its former partners — including Spain’s Telefonica — were asked to leave after they took a simultaneous stake in rival operator CableVision.
“Ted Turner or a telco are good examples” of the kind of partner Multicanal is seeking, a company source said.
But local player Telecom — a French-Italian company that controls half of the telephone market and has been touted as a likely partner for Multicanal — is believed to be shying away from investing in cable.
That leaves such U.S. telcos as GTE, which is already partnered with Clarin in provincial cellular phone operation CTI, as the most likely candidates.
At recent market rates, the price of a 49% stake in Multicanal could range anywhere between $550 million and $900 million.
The prospect of cable-telephony convergence in Argentina is still somewhat hazy, however, as President Carlos Menem’s March decree is being contested in court.
If all goes according to plan, hardwire telephony will be part-deregulated in Nov. 1999, when cable players and cellular phone companies can enter the arena, and fully deregulated in Nov. 2000.