Mexican Court Dashes Slim's TV Bid Reuters
go to original July 6, 2012

Carlos Slim Helú, owner of Teléfonos de México (Marco Peláez)

MEXICO CITY - Carlos Slim may be years from winning a coveted license to enter Mexico's television market after a court on Thursday dashed the hopes of the world's richest man to expand his media empire on his home turf.

Slim's bid to enter the pay TV market will now not likely be decided until after Mexico's next president takes office in December. While Slim could cling to hopes of getting his license by early next year, a court battle could stretch into 2014, traders said.

The case will test the administration of Enrique Pena Nieto, which has promised to increase competition in Mexico where Slim dominates the phone market.

The legal setback could force Slim to make more concessions to his weak rivals who have been fighting for a decade to whittle away at Slim's dominance.

Gerardo Sanchez, legal director for Mexico's Communications and Transport Ministry (SCT), said late Thursday an appeals court on Thursday threw out an injunction filed by Slim's Telmex, the country's dominant phone and internet provider, against an earlier ruling in the case.

The decision means Telmex will have to reapply from scratch for a TV license, Sanchez said.

"They are passing the ball to the next administration," said Jaime Martinez, a trader at brokerage Actinver in Mexico. "This is going to be a challenge for the next government to define what this administration could not do."

A Telmex official said the company could not immediately comment on the ruling.

"This is a firm decision that denies the injunction by Telmex and recognizes the validity of the government's resolution," Sanchez said.

Slim will now have to lobby the incoming government, which has been accused of having close ties to Mexico's top broadcaster Televisa. Televisa has fought hard to preserve its stranglehold on the broadcast and pay TV market.

Shares in Slim's America Movil, which owns Telmex, slipped 0.35 percent to 17.25 pesos.

The SCT rejected Telmex's bid to offer pay TV in May 2011 on the basis it had not met regulators' demands to provide rivals with fair access to its network. Telmex argued to the court that it had met all its obligations.

Slim is already a dominant force in the pay television market elsewhere in Latin America and his companies control around 70 percent of the mobile phone market in Mexico and about 80 percent of the fixed-line business.

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