Latin America: Opportunity Awaits

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By Jeffrey Yorke

Long the “Land of Opportunity,” America has been the destination for people looking to expand their horizons, beef up their bank accounts, and better their lives. But there may be some opportunities left, south of the border. A slew of American tower companies are discovering the charms of Latin America.

“We have more than 250 assets in Guatemala, 350 in Nicaragua and over 1,000 altogether, all home-grown built with nothing acquired through acquisitions,” Maria Scotti, CEO of Torrecom Partners LLC, said proudly during the opening minutes of the “Tower Strategies in Latin America” session at the Tower Summit in Las Vegas.

Scotti talked about Latin America and the Caribbean with the excitement of a successful 1849 gold rusher skipping over the hills of San Francisco. Noting the devil is in the details of contracting with land owners and carriers, she was optimistic about the near future. “AT&T has finally started advertising, [cellular] plans are reducing. Everyone is fighting for the consumer—trying to get four or five thousand sites rationalized before everyone really gets going.”

Phoenix Tower International CEO Dagan Kasavana shared a similar enthusiasm, “It’s been a great ride so far!”  It was less than two years ago that Kasavana, the former Global Tower International mergers and acquisition director founded his Boca Raton, FL-based tower company. PTI has expanded to a handful of Latin countries including Costa Rica and Puerto Rico. He says the company strives “to be a partner to the carriers with the ability of build-to-suit.”

Long stays are not for everyone. Chahram Zolfaghari, CEO of the four-year-old Brazil Tower Company, LP, describes the Miami-based operation as if it were the “In ‘N’ Out Burger” of the tower business.

“We are in the business of getting out of this business. From day one, we are building to sell this business.” He was just as quick to add his reasoning. “The interest rate is about 16% in Brazil. But it’s not more than the value of equity – about 30%. Every time we sell one tower, I build four more.”

Maybe Zolfaghari was being a tad cheeky when he added, “Being able to control a company is better to me than being the king and saying, ‘I have $3,000.’” But he also could be onto something.

None of the four panelists including Jose Sola, whose year-old Mexico Towers Partners operates from Mexico City, reported deals that provided for sharing profits with carriers. That, they say, is talk for another day when businesses mature and carriers’ profits abound. While it is based in Mexico City, the company is funded by Digital Bridge Holdings of Boca Raton, FL, and is an American company. MTP manages more than 550 towers, making it Mexico’s second largest independent telecommunications tower business.

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