BUENOS AIRES — Argentina’s Commerce Secretariat has approved the $1.1 billion merger of the country’s two biggest cablers, Cablevision and Multicanal, to improve competition and expand cable and broadband services.
Argentine media conglom Grupo Clarin, which holds majority stakes in both companies, plans to weave the operations together, cutting infrastructure and programming costs, to enter the telephony market.
Before final approval, Clarin must provide investment commitments and other information to the antitrust department.
The conglom has said it will invest $500 million through 2010 to lay 1,864 miles of fiber-optic cables to expand its broadband and cable services and roll out telephony, helping enlarge its sub base and boost revenue-per-user with the offering of more content and services.
The merged company will have a total of 2.8 million subs, or 47% of the 6-million cable market, and 620,000 broadband users.
Antitrust authorities believe expanding the Cablevision-Multicanal business will improve competition, as satcaster DirecTV Latin America is the only player in some areas.
For final approval, the combined company must offer a smaller and lower-priced package to poorer households.
Grupo Clarin launched the merger in 2006. The conglom also has interests in publishing, radio and TV broadcasting and film and TV production.