Turmoil in Mexican Network Sale

The calm sale of Mexico's CDMA network operator, Grupo Iusacell to Movil Access has been thrown into confusion following a counter bid from Fintech Advisory, a New York fund that owns debt bonds in Grupo Iusacell. Fintech is offering US$20 million for the debt ridden network, double the agreed price from the local paging network operator, Movil Access.

Iusacell subsequently announced that its principal shareholders, Verizon Communications and Vodafone have notified Fintech that they have determined not to engage in discussions with Fintech regarding a possible transaction involving the Company and do not intend to tender their shares of the Company into any offer by Fintech. The two companies have also rejected an offer from UBS to buy all the shares for US$15 million.

"We think that our offer is clearly in the best interests of Verizon's and Vodafone's shareholders, as it will double the proceeds," said the letter, signed by Fintech President Julio Herrera, which was included in a filing of the bid with the Securities and Exchange Commission.

Iusacell says that it will make further public announcements in connection with the tender offers at the appropriate time and as required by Mexican and United States securities laws. There is wide expectation that Movil Access will merge Iusacell with its existing cellular network, Unefon to spread the debt and reduce CAPEX costs."

Posted to the site on 21st July 2003