NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Monday, December 23, 2019

By Luis Sanchez

Millicom International Cellular provides telephone, pay-TV, and internet services to markets across Latin America and Africa. Historically, the telecom had a large African presence, but in recent years, it has exited most of its markets there. At the same time, it has made a series of bold acquisitions in Latin America.

Why has Millicom gone down this path?

First, a little background on Millicom

Millicom has telecom operations in Latin America and Africa, but its business today is mostly in Latin America. The company was founded in 1990 in partnership with European technology conglomerate Kinnevik Invest.

Millicom has been build on the back of a series of telecom acquisitions in various international markets. This has been an effective strategy in terms of giving the company a strong regional presence in Latin America and Africa, but investors are starting to question the strategy. Millicom may have gotten too acquisition-happy and expanded into less attractive markets for the sake of growth. As it turns out, there isn’t much of a strategic rationale to own telecom assets spanning multiple continents.

Photo courtesy of Kevin Keith.