Mexico America Movil Sees 22 Million New Net Subscribers In 2007

MEXICO CITY -(Dow Jones)- Mexican mobile operator America Movil sees its net subscriber additions reaching 22 million next year, a top company executive said Friday.

"I think maybe 22 million customers for next year would be a very good year," the company's Chief Executive Daniel Hajj said in a conference call with analysts.

The projected additions don't include the customers America Movil would pick up with the pending acquisition of Verizon Communications assets in Puerto Rico, Venezuela, and the Dominican Republic, Hajj said.

Capital expenditures in 2007 will be about the same as the $3 billion the company plans to invest this year, he added.

On Thursday, America Movil said its net profit more than doubled to 10.97 billion pesos ($1 billion) in the third quarter from a year-earlier MXN4.59 billion as subscriber additions contributed to a surge in sales.

America Movil, Latin America's biggest mobile operator, said it added 6.2 million subscribers in the quarter, bringing its total to 113.9 million.

Mexican unit Telcel gained 1.6 million customers to end the quarter at 40.7 million. Brazil added 1.2 million subscribers to 22.2 million, while Colombia added 786,000 to 18.8 million. In the U.S., Tracfone added 215,000 clients to 7.2 million.

Hajj said overall mobile penetration in Latin America could reach between 70% and 75% in the next three years. In Colombia, the company's third-largest market, mobile penetration is already at 70%, according to America Movil.

America Movil is poised to expand its coverage in the region with the purchase of Verizon's Latin American assets, which is subject to regulatory approval.

In April, the company said it would buy Verizon Dominicana, a 52% stake in Telecomunicaciones de Puerto Rico, and a 28.5% stake in Venezuela's CA Nacional Telefonos de Venezuela SA (VNT), or CANTV. America Movil has teamed up with Mexican fixed-line company Telefonos de Mexico to buy CANTV.

"I think Puerto Rico is on schedule. I think we can close Puerto Rico in January of next year, maybe a little bit earlier," Hajj said.

Verizon is still negotiating a tax payment with the Dominican Republic government, while America Movil is waiting for a reply from Venezuelan authorities, he added.

In response to a question about whether America Movil would be interested in buying Brazilian mobile operator Tim Participacoes, Hajj he would look at the company if it were to be put up for sale.

Italian newspapers have reported that Telecom Italia (TI) may be preparing to sell TIM as part of an effort to pay down debt.

"What I know is that TSU today is not officially for sale, and if they were for sale I think we are obligated to look at the company. If it's under fair prices and circumstances, of course we should do it," Hajj said.

-By Ken Parks, Dow Jones Newswires; (5255) 5080-3453; ken.parks@dowjones.com

(END) Dow Jones Newswires "

Posted to the site on 27th October 2006