Lusacell Mexico

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Iusacell was awarded licenses to operate cellular phone services in four regions in Mexico in 1990. The company was owned by Bell Atlantic and Grupo IUSA by 1997. Iusatel, a wholly-owned subsidiary of Iusacell, was awarded a concession to operate as a national and international long distance carrier in February 1996. Iusatel was one of the eight companies that obtained a concession to operate as long distance carrier between 1995 and 1996. Such licenses were issued as part of Mexico's liberalization strategy of its telecommunications market. Iusatel's project consisted of building a 7,500 km fiber cable in Mexico to provide its long distance services. The total project cost was estimated as US$ 410 million, according to Comision Federal de Telecomunicaciones (Cofetel), the Mexican regulatory agency for telecommunications. The first phase of this project was operational by the end of 1996 and cost around US$ 300 million. In 1993, the IFC approved an US$ 27 million financing package to Telecomunicaciones del Golfo, the telephone system serving Mexico's VII region (US$ 1 million direct loan; US$ 18 million syndications; US$ 0.6 million equity; and US$ 7.4 million quasi-equity). Iusacell has invested around US$ 600 million in developing its telecommunications network by 1997. The company invested US$ 283 million in 1998. Such figure included the US$ 58 million that the company paid for PCS license (spectrum fees) in the regions 1 and 4. In 1999, the company awarded a US$ 60 million contract to Lucent Technologies. In 2000, the company awarded a US$ 3.8 million contract to Fujitsu Network Communications to construct an SDH fiber optic transport network to construct the three largest cities in Mexico: Mexico City, Monterrey and Guadalajara. In April the company also raised US$ 250 million through issuing an American Depository Receipt (ADR) arranged by JP Morgan and Warburg Dillon Read to fund cellular capacity, as well as the first phase of the launch of PCS services, which is planned for the third quarter 2000. By the end of the first quarter 2000, the company had over 1.3 million prepaid subscribers. Also in 2000, Vodafone of the UK purchased a 34.5% stake in Iusacell for $973.4 million. In the 4th Quarter 2001, the company closed the acquisition of Grupo Portatel, SA de CV, the A-band cellular carrier in Region 8 (States of Chiapas, Tabasco, Yucatan, Campeche, and Quintana Roo), and successfully completed a $100 million rights offering. Portatel del Sureste was originally awarded a license to operate the cellular phone services in Region 8 in 1990 and started to operate in November 1990. Its operations are now consolidated into Iusacell. In 2003, Verizon and Vodafone sold their stakes, 39.4 percent and 34.5 percent respectively, in Iusacell to Movil Access. Mexican investor Ricardo Salinas is the owner of the Mexican paging firm Movil Access. Salinas acquired the combined 73.9 percent stake for US$10 million plus US$811 million of debt that was partly in default as of 2003. In 2005, Isuacell terminated its ADR program and delisted its ADRs from The New York Stock Exchange. Also in 2005, Iusatel was granted an authorization from SCT to provide fixed local wireline telephony nationwide (valid for the duration of the long distance concession) and for which is obligated to build 15 urban fiber rings in 5 Mexican cities. In April, 2007, the shareholders of Unefon approved the merger with a mobile operator, Iusacell, which issued around 34.2 million new shares to Unefon shareholders. At the time of the merger, Iusacell was valued at US$1.0 billion and Unefon at US$333.3 million. The newly merged operator will have around 3.4 million subscribers, a market share of around 7%. In January 2015, the American company AT&T acquired Lusacell for US$ 2.5 billion. See hidden Project #1589 for Portatel info. 'Other' in sponsors refers to Ricardo Salinas Pliego who owns 7.4% of the shares, the remaining 18% corresponds to public float. In 2005, Iusacell's subscriber base was 1,857,065. Of these subscribers, 583,695 were postpaid customers and 1,273,370 were prepaid customers. Also in 2005, the long distance network consists of 5,310 kilometers of fiber optic backbone. In 2006, the company planed to invest U.S.$70.0 million.