RIO DE JANEIRO, BRAZIL – In recent days, two U.S. giants have announced significant acquisitions in the Republic of Panama at a crucial time for the country’s economy.
On September 14, AES Corporation announced a 49.9% stake in AES Colon from Inversiones Bahia, Ltd. of the Motta Group, becoming 100% owner of the liquefied natural gas (LNG) project.
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And a day later, on September 15, Liberty Latin America, through its subsidiary Cable & Wireless Panama S.A., announced that it had agreed to buy America Movil’s business in Panama (Claro Panama) for US$200 million.
Fernando Aramburú Porras, economist, businessman, and former Minister of Economy and Finance of the Republic of Panama (1999), “both transactions are worth highlighting.”
Aramburú Porras said that the fact that these two large U.S. companies have decided to acquire other businesses “shows the confidence of companies in the future of the country.”
In the case of Liberty Latin America, Julio Spiegel, executive president of Cable & Wireless Panama, said that two years ago, the company analyzed the entire region to find out where it wanted to establish its operations center.
So, in 2018, Liberty’s Latin America headquarters was established in Panama. The reasons were many: “It’s a country with economic stability,” he said.
“The impact on the (Panamanian) economy is cyclical, of course, because of the pandemic, but the conditions for growth are perfect. It has economic, political, and security stability serving Latin America,” Spiegel said.
He stressed that the advantage of the international airport of Tocumen, the hub of the Americas, is that travel is much more convenient. It is also beneficial for the executives of these companies to come to Panama and maintain their usual lifestyle.
In addition, all the undersea fiber optic cables run through the banks of the Panama Canal, which benefits from the neutrality agreement, and an ecosystem has formed of several companies that have moved to Panama and have the opportunity to become part of the digital hub of Latin America, he added.
“I believe that (Panama) will be the digital hub of the world,” said Spiegel, who pointed out that Cable & Wireless Panama’s balance sheets are still “solid,” and that is the reason for this investment.
INNOVATION
Spiegel stressed that Liberty is an innovative company and that Cable & Wireless Panama also has a history of innovation.
“We started laying fiber optic cables to homes three years ago, and today a quarter of the homes in Panama are covered by fiber optic cables, and we have set out to do the same for the rest of the homes,” he said.
He said that with the innovation that will come with the union of these two robust networks – Claro and + Móvil – it will be possible to offer a “better service and higher speed, but innovate with 5G.”
He said that once the transaction is completed, they will invest around US$500 million next year to achieve the goal.
“The investments will go to several areas: the integration of the two networks, redundancy to make them more robust, but also 5G,” he affirmed.