Amé rica Mó vil Spinoff Telesites Gains in Market Debut

MEXICO CITY—Shares of Telesites SAB, the mobile-towers company spun off by telecommunications heavyweight Amé rica Mó vil, rose Monday as the stock began trading on the Mexican stock exchange.

Telesites shares priced at 13 pesos (76 cents) each in a premarket auction, and were up 1.5% at 13.19 pesos midmorning. Amé rica Mó vil shareholders received one Telesites share for every 20 Amé rica Mó vil shares held.

Amé rica Mó vil shares gained 4.9% to 12.65 pesos.

The Intercam brokerage said in a recent note: "We think that Telesites could be an attractive investment vehicle given its projections for profitability and growth." Telesites could benefit from the expansion plans of third-party mobile operators, although its pricing could be limited by regulations, the company added.

Amé rica Mó vil decided in 2014 to separate its mobile towers into Telesites as part of the company's response to new telecommunications laws, under which Amé rica Mó vil was declared dominant given its more than 50% market share and was hit with regulations including forced infrastructure sharing and zero charges to connect incoming calls to its mobile network.

As part of the group of companies controlled by billionaire Carlos Slim, Telesites is also subject to dominant regulations.

Telesites expects to end this year with around 12,600 towers, and plans to continue expanding the network while increasing the average number of users per tower. Its main customer is Amé rica Mó vil unit Telcel, although it has signed leasing agreements with Spain's Telefó nica and AT&T Inc.

"Telesites will seek to find better locations for its new towers, increase the number of customers using each tower, increase its number of towers and be efficient in its operations in order to create value," Amé rica Mó vil said in a recent filing. "These goals will be aligned with those of wireless telecommunications operators, because they will be able to deploy new technologies, have continuity in coverage and quickly expand their mobile network."

Telesites won't have American depositary receipts, so holders of Amé rica Mó vil ADRs will be able to choose between holding local Telesites shares or taking cash. That could create some overhang for the share price since depositary banks could sell shares in the open market, Credit Suisse said in a recent report.

Write to Anthony Harrup at [e-mail]

(END) Dow Jones Newswires

December 21, 2015 12:25 ET (17:25 GMT)

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