UPDATE 2-China-backed bid wins Mexico tender for major telco network

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MEXICO CITY, Nov 17 (Reuters) - Mexico has declared a Chinese-backed group winner of a tender to build and run a multi-billion dollar wholesale mobile network, the first major new investment announced in the country since Donald Trump’s U.S. election victory.

The contract award marks the end of a saga over the ambitious tender, which was delayed several times, disputed by one participant and finally left to just one bidder.

The winning group, Altan, counts a fund managed by Morgan Stanley Infrastructure, part of Morgan Stanley, as its largest shareholder, with 33.38 percent.

Second-largest is the 23.36 percent stake held by the China-Mexico fund created by the two countries in 2014, managed by a unit of the World Bank’s International Finance Corporation.

The planned investment comes as uncertainty clouds Mexico’s relations with the United States after Trump’s victory. The brash real estate tycoon has threatened to radically shake up trade ties between the two neighbors at Mexico’s expense.

Altan, which has already raised $750 million from its investors, promised in its bid that the network would cover 92.2 percent of the population within seven years.

The government has estimated 85 percent coverage would require an investment of some $3.5 billion, and 95 percent around $7 billion.

The network is the second investment by the China-Mexico fund, which has raised $1.2 billion to date.

China has provided $1 billion of that, of which $700 million comes from sovereign wealth fund China Investment Corporation, with the rest from China Development Bank, a person familiar with the matter said, speaking on condition of anonymity.

China’s President Xi Jinping is currently embarking on a trip to Latin America. Visiting Chile, Ecuador and Peru, he is due to speak at the Asia-Pacific Economic Cooperation (APEC) summit in Lima on Saturday.

Mexico’s government had to tender the shared network under a 2013 telecoms reform aimed at curbing the dominance of Carlos Slim’s America Movil.

As the winner, Altan will get cheap use of high quality spectrum in the 700MHz band and a 20-year public-private partnership contract to build a 4G LTE mobile network that operators and virtual network operators can rent.

Earlier this month, the government disqualified the only other bidder Rivada for not presenting the bid bond on time. Rivada disputed the decision.

The Altan consortium also includes Canada’s second-largest pension fund, Caisse du Depot et Placement du Quebec, Mexico’s Megacable and conglomerate Alfa’s unit Axtel. (Reporting by Christine Murray; Editing by Dave Graham and Chizu Nomiyama)