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ALFA announces that its subsidiary Axtel signed agreement to sell its Mass Market Business to Megacable for Ps. 1,150 Million

MONTERREY, Mexico, May 2, 2019 /PRNewswire/ -- ALFA, S.A.B. de C.V., announced today that its subsidiary Axtel, S.A.B. de C.V., a Mexican  Information and Communication Technology (ICT) company, signed a definitive agreement to sell its fiber, Mass Market Business (FTTx) located in León, Puebla, Toluca, Guadalajara and Querétaro, to Megacable Holdings, S.A.B. de C.V. and subsidiaries ("Megacable") for Ps. 1,150 Million. Net proceeds from this transaction will be used  to improve Axtel's capital structure.

Effective May 1st, 2019, Axtel transferred 55 thousand residential and micro-business customers, 1,370 km of FTTx fiber optic network and other assets related to the operation of the mass market segment in these cities to Megacable. This agreement has been notified to Mexico's industry regulator, Instituto Federal de Telecomunicaciones.

"With this transaction, we are concluding the divestment of the FTTx Mass Market business as part of our strategy to focus on the Enterprise and Government markets. The successful monetization of this business, together with the initiatives to engage with a strategic partner for our Data Centers business and the separation of our operations in two strategic units, reflect our commitment of maximizing value for our shareholders. Net proceeds from the transaction will be used to reduce debt and other liabilities, thus, improving our capital structure and reducing interest expense", said Rolando Zubirán Shetler, Axtel's President.

About Axtel

Axtel is a Mexican Information and Communication Technology Company that serves the enterprise and government segments with a robust portfolio of IT and Telecommunications solutions through its brand Alestra. With a network infrastructure of over 40 thousand kilometers of fiber and more than 6,700 square meters of data center, Axtel enables organizations to be more productive through innovation. As of February 15, 2016, Axtel is a subsidiary of ALFA, which owns 52.8% of its equity. Axtel shares, represented by Ordinary Participation Certificates, or CPOs, trade on the Mexican Stock Market under the symbol "AXTELCPO" since 2005.

About ALFA

ALFA is a holding company that manages a portfolio of diversified subsidiaries with global operations: Alpek, one of the world's largest producers of polyester (PTA, PET and fibers), and the leader in the Mexican market for polypropylene, expandable polystyrene (EPS) and caprolactam. Sigma, a leading multinational food company, focused on the production, marketing and distribution of quality foods through recognized brands in Mexico, Europe, United States and Latin America. Nemak, a leading provider of innovative lightweighting solutions for the global automotive industry, specializing in the development and manufacturing of aluminum components for powertrain, structural components and for electric vehicles. Axtel, a provider of Information Technology and Communication services for the enterprise and government segments in Mexico. Newpek, an oil and gas exploration and production company with operations in Mexico and the United States. In 2018, ALFA reported revenues of Ps. 366,432 million (US $19.1 billion), and EBITDA of Ps. 55,178 million (US $2.9 billion). ALFA's shares are quoted on the Mexican Stock Exchange and on Latibex, the market for Latin American shares of the Madrid Stock Exchange.



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