Telefonos de Mexico said on Friday it has agreed to take a majority stake in Colombia Telecomunicaciones (Telecom), Colombia's state-owned telephone company, with a $350 million investment in the fixed-line company.
The Mexican phone giant, also known as Telmex, said it would put up $260 million in cash and another $90 in stock in its local unit Telmex Colombia to merge it into Telecom.
"This investment will entitle Telmex to 50 percent plus 1 share of Telecom's capital," Telmex said in a statement.
Current Telecom shareholders will own the remaining stake, and Telmex will receive a management fee worth 3 percent of Telecom revenues as long as it remains a shareholder.
Telmex said the proposed agreement will be posted on the Colombian government's Web site for five days and is expected to be signed at the end of that period. The memorandum of understanding provides an initial term of 45 days to formalise the transaction documents, Telmex said.
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