April 9, 2014 / 8:41 PM / 4 years ago

Fitch: Colombia Telecommunications Moving Toward Consolidation

(The following statement was released by the rating agency) BOGOTA, April 09 (Fitch) Fitch Ratings expects stable growth for the Colombian telecommunications sector over the medium term, given the favorable macroeconomic environment and rising revenues from Internet data traffic. Fitch forecasts that mobile data revenues will continue to increase, representing about 25% of total revenues by 2017, driven by rising smartphone penetration and the rollout of the 4G long-term evolution (LTE) services. Colombia telecommunications sector is moving toward consolidation, driven by competitive pressures, high investment needs and the downward trend in service prices. These factors have required companies to strengthen their operations and service structure. Fixed-line and mobile operators in Colombia rated by Fitch generally have robust credit profiles, adequate levels of operating profitability, and cash generation ability to finance a significant portion of their investment needs. Leverage is manageable and relatively low. Fitch estimates that in the next few years free cash flow generation will be neutral to negative, due to higher capital investment needs. However, this should not lead to significant additional indebtedness by operators. For more information, the special report titled 'Telecommunications Colombia: Toward a Convergent Market' is available on the Fitch Ratings web site at www.fitchratings.com, or by clicking on the link. Contact: Natalia O'Byrne Director +57-326-9999 Ext. 1100 Fitch Ratings, Inc. Calle 69 A, No.9-85 Bogota, Colombia Jorge Yanes Director +57-326-9999 Ext. 1170 Media Relations: Elizabeth Fogerty, New York, Tel: +1 (212) 908 0526, Email: elizabeth.fogerty@fitchratings.com. Additional information is available at 'www.fitchratings.com'. Applicable Criteria and Related Research: Telecommunications Colombia (Toward a Convergent Market) here ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: here. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

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