America Movil has completed the spin-off of its telecoms towers business in Latin America, formally creating the Sitios Latinoamérica business that it has been talking about for some time.
It’s a case of better late than never for the Mexican incumbent, which first announced its plan to hive off its mobile sites in the region almost exactly 18 months ago. At that stage, in early 2021, America Movil said it expected to carry out the process before the end of the year, but the restructure of assets seems to have taken a little longer than it expected. Indeed, it’s almost a year since the operator’s shareholders gave the go-ahead for the move.
But now the business, which America Movil is calling Sitios Latam for short, is up and running, various assets, liabilities and capital having been transferred over from its parent company.
America Movil hasn’t had a lot to say about the future of the unit, but one sentence from its spin-off announcement says it all: “Sitios Latam will continue to evaluate growth opportunities in the region.”
The operator could mean organic growth, and that certainly factors in its plans, at least to an extent. Sitios Latam “focuses on the construction, operation and marketing of towers and other structures for the installation of telecommunications equipment,” the firm says, and the construction element of that is already underway. The unit has the best part of 30,000 towers – 29,090, to be exact – across 13 Latin American countries, 39% of the total being in its biggest market, Brazil. The list of countries does not at present include Peru, but the company notes that it has just started to build towers there.
Growth will also come through improving the business’s tenancy ratio, something that should be easier for it to achieve as a standalone unit. For now, Sitios Latam simply states that its towers across the region will be available for use by all telecoms service providers.
Incidentally, Sitios Latam’s 13 markets do not include America Movil’s home market of Mexico. There the telco’s towers were spun off into a business known as Telesites as long ago as 2015 amidst various regulatory pressures that were designed to curb its market dominance. The firm raised US$600 million through an IPO in 2020 and indicated that it might pursue such a strategy elsewhere in the region in the fullness of time, but has said little on the matter since. Such a move is not out of the question for Sitios Latam.
Neither is the idea of bringing in an external investor, as many telcos the world over have done in recent years. There’s no indication that this is America Movil’s intention, but given the variety of towers deals we have seen of late, it could be an option.
America Movil’s controlling shareholders, the Slim family, still hold a combined controlling stake in Telesites, which perhaps suggests that the operator is not keen to give up control of its towers. But there are ways of structuring deals that would allow it to remain in charge.
For now it seems to be all about building up the towers business across LatAm. But it will come as no surprise if a financial deal follows, sooner or later.
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