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Millicom International Cellular SA SDR TIGO SDB

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America Movil Sells Panamanian Assets to Liberty Affiliate; Net Positive for Millicom

Analyst Note

| Michael Hodel, CFA |

America Movil agreed to sell its operations in Panama to Cable & Wireless Panama, an entity jointly owned by Liberty Latin America and the Panamanian government, for $200 million. While the deal isn’t significant relative to Movil overall, it represents the firm’s latest move to simplify its business and divest assets that aren’t well positioned competitively. Movil’s Panamanian business is tiny, consisting of only 760,000 wireless customers (about 13% market share) and generating only $157 million of revenue in 2020 (about 7% of its Central American segment, which contributes about 5% of consolidated revenue). Movil will retain its wireless towers in the country, contributing these to its planned tower spinoff. Our $18 fair value estimate for Movil is unchanged, and we believe the shares are roughly fairly valued.

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Company Profile

Business Description

Millicom offers wireless and fixed-line telecom services primarily in smaller, less congested markets or in less developed countries in Latin America. Countries served include Bolivia, Honduras, Nicaragua, Panama, El Salvador, Guatemala, Paraguay, Colombia, and Costa Rica. It also operates in Africa but has been selling out of African markets over the past couple years. Increasingly, it offers a converged package that may include fixed-line phone, broadband, and pay television in conjunction with wireless services.

Contact
2, Rue du Fort Bourbon
Luxembourg, L-1249, Luxembourg
T +352 27759101
Sector Communication Services
Industry Telecom Services
Most Recent Earnings Jun 30, 2021
Fiscal Year End Dec 31, 2021
Stock Type
Employees 21,419

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