El Salvador sets conditions for Tigo’s acquisition of Caribeña

The Competition Superintendence of El Salvador (CS) has established a number of condition before approving the acquisition of the pay TV and Internet operator Caribeña by Tigo (Millicom).

In a statement, CS said Grupo Caribeña provides pay TV and internet services in 15 municipalities, mostly in the eastern zone. In turn, Tigo provides pay TV, fixed and mobile broadband, and fixed and mobile telephony nationwide.

Conditions includes the prohibition of unreasonable price increases or reduction of offers and quality. In addition, Tigo cannot commercialize pay TV packages tied with other services and will have to deploy a hybrid fibre network (HFC), such as it owns in other parts of the country.

According to CS, the transaction carries risks to the pay TV market because it would eliminate one competitor and will strengthen Tigo’s dominant position.

However, CS also said that the acquisition could allow Tigo to strengthen its capacity to compete in the rest of the telecommunication services, where the leader is another competitor, motivating its new customers to acquire other services, such as telephony or the internet.