Entel-GTD merger off

12 January 2012 |


Chilean telcos Entel and GTD have reportedly cancelled their planned merger after ending a memorandum of understanding announced on November 28. GTD’s controlling shareholder Juan Manuel Casanueva is thought to be responsible for backing out of the deal.

The merger had been halted after the country’s economic attorney general’s office called a probe into the impact it would have on the industry and created a series of conditions for its approval.

In order for the merger to receive the go ahead it would have had to surrender 50 Mhz of spectrum n the 3.4-3.6 GHz band, and end the MVNO contract that GTD’s Telsur unit has with rival Movistar.

Although no official reason was given for the ending of the agreement it is likely that the conditions being imposed by the authority were a significant factor.

Local sources suggest that the anti-trust authority was concerned that the merger would allow Entel to achieve a mobile monopoly in southern Chile.

The long haul capacity supplied by the merger would have allowed Entel to expand its presence in the country’s mobile broadband sector.