Moody's affirms Telmex

Moody's Investors Service said it affirmed Telefonos de México, SAB de CV's A3 global foreign-currency and global domestic-currency ratings. Simultaneously, Moody's de Mexico affirmed Telmex's Aaa.mx national scale ratings.

The outlook is stable.

The affirmation follows America Movil, SAB de CV's announcement of its intention to acquire Carso Global Telecom, SAB de CV, which owns 59.4% of Telmex.

The affirmation was based on Moody's view that Telmex's credit profile may benefit longer term from the closer integration of various telecommunications assets of America Movil with those of Carso Global Telecom, the agency said.

But Moody's added that the affirmation incorporates some of the challenges that may exist in the near term, including overcoming any regulatory hurdles.

Telmex's ratings are supported by its status as Mexico's leading wireline telecom service provider, and its ratings are restrained by steadily increasing competitive challenges posed by continued significant mobile substitution, more robust bundled offerings from cable TV companies and strengthened propositions from enterprise data service providers, the agency said.

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