Reuters: Global Markets: America Movil shares extend slide on telecom reform plan

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America Movil shares extend slide on telecom reform plan Mar 13th 2013, 16:53 MEXICO CITY | Wed Mar 13, 2013 12:53pm EDT MEXICO CITY (Reuters) - Shares of America Movil, the company owned by billionaire Carlos Slim, extended their slide on Wednesday with a 6 percent drop, after the government on Monday proposed an overhaul of the nation's phone and television industries that would loosen Slim's dominance of the telecommunications market. The sweeping reform bill, presented by President Enrique Pena Nieto, would end broadcaster Televisa's dominance of the airwaves as well as Slim's stranglehold on the phone business. The revamp would permit more foreign ownership of media and phone companies and give regulators the power to compel players controlling more than 50 percent of the market to sell assets, allowing for more competition. Slim, the world's richest man, controls about 70 percent of Mexico's mobile market and 80 percent of its fixed phone lines. America Movil (AMXL.MX) (AMX.N) shares shed 6.2 percent to 12.04 pesos in morning trading, the lowest level since June 2009. The company's stock, which had tumbled after the company reported disappointing quarterly results last month, has lost around a fifth of its value in the year to date. The slump in America Movil shares weighed on Mexico's IPC stock index .MXX, which fell 1.3 percent. America Movil shares could fall further in the medium term to between 10 and 11 pesos, analysts at Mexico City-based brokerage Monex wrote in a report. In the short term, the shares could find a level of support between 11.70 and 12 pesos, the analysts said. Shares of Televisa (TLVACPO.MX) (TV.N), the world's biggest Spanish-language content producer, fell 2.5 percent, dipping below 66 pesos. The company is believed to control three-fifths of Mexico's broadcast market. Shares in TV Azteca (AZTECACPO.MX), Mexico's second-biggest broadcaster, were down 2 percent at 8.82 pesos. Previous Mexican governments have failed to rein in the power of the huge telecommunications companies and the reform bill still faces a number of hurdles before it can become law. BUYBACKS America Movil continued to aggressively buy back shares this week, but the purchases have not stemmed the slide in the share price. The company on Tuesday executed its biggest one-day buyback this year, buying back 75 million shares, but the share price closed down 2.43 percent at 12.83. The company's spent a total of 1.6 billion Mexican pesos ($128.55 million) on Monday and Tuesday on share purchases, buying back 125 million shares, according to stock exchange filings. Since reporting weak fourth-quarter results on February 12, the company has spent 5.286 billion pesos buying back shares. Its shares have fallen more than 23 percent since then. America's Movil buyback fund was at 43.938 billion pesos after Tuesday's stock purchases. (Reporting by David Alire Garcia and Elinor Comlay; Editing by Maureen Bavdek, Bernadette Baum and Leslie Adler) Link this Share this Digg this Email Reprints

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