NORTEL INVERSORA SA BUENOS AIRES, Argentina, May 10, 2017 /PRNewswire/ -- Nortel Inversora S.A. ("Nortel") (NYSE: NTL) announces consolidated income of AR$ 1,959 million for the first quarter of fiscal year 2017, of which AR$ 1,081 million correspond to Nortel as parent company of Telecom Argentina S.A. ("Telecom").
The sole material activity of Nortel is holding 54.74% of the capital stock of Telecom, representing a holding of 55.60% of the voting and economic rights of Telecom as a result of Telecom's holding of 15,221,373 shares of treasury stock. The holding of such shares of treasury stock has been extended for up to three additional years pursuant to the resolution of the Ordinary and Extraordinary Stockholders Meeting of Telecom held on April 29, 2016.
(Financial Tables below)
First Quarter, Fiscal Year 2017
-------------------------------
(in millions of Argentine Pesos)
Consolidated
Income
Statement March 2017 March 2016
------------ ---------- ----------
Total
sales
and
other
income 14,742 12,474
Operating
costs (11,856) (10,483)
------- -------
Operating
income 2,886 1,991
Financial
results,
net 126 (550)
--- ----
Net
income
before
income
tax
expenses 3,012 1,441
Income
tax (1,053) (507)
------ ----
Net
income 1,959 934
----- ---
Other
comprehensive
income,
net of
taxes (21) 189
--- ---
Total
comprehensive
income
for the
period 1,938 1,123
===== =====
Consolidated
Balance
Sheet March 2017 December 2016
------------ ----------- -------------
Current
assets 16,360 15,620
Non-
current
assets 32,563 32,354
------ ------
Total
assets 48,923 47,974
====== ======
Current
liabilities 15,982 16,524
Non-
current
liabilities 11,115 11,527
------ ------
Total
liabilities 27,097 28,051
====== ======
Equity
attributable
to
Nortel 11,868 10,797
Equity
attributable
to non-
controlling
shareholders 9,958 9,126
----- -----
Total
equity 21,826 19,923
------ ------
Total
liabilities
and
equity 48,923 47,974
====== ======
Ratios
------
Liquidity
(a) 1.02 0.95
Indebtedness
(b) 1.24 1.41
(a) Current assets to current liabilities
(b) Total liabilities to shareholders' equity
Relevant facts
Corporate Reorganization
On March 17, 2017, the Company received notice from its direct controlling shareholder Sofora Telecomunicaciones S.A. ("Sofora"), who informed that its shareholders had expressed their wish that the Board of Directors of Sofora as well as the ones of its subsidiaries Nortel Inversora S.A. ("Nortel"), Telecom Argentina S.A. ("Telecom Argentina") and Telecom Personal S.A. ("Telecom Personal") evaluate a corporate reorganization at the head of Telecom Argentina S.A. as the surviving company, aiming to conclude this reorganization during the current year. This project seeks to simplify the shareholding structure of Telecom Argentina in line with international standards and market practices.
In this context, it has been agreed that Sofora amortizes, in the terms of Article 223 of the General Corporate Law No. 19,550, the shares owned by W de Argentina Inversiones S.A. ("WAI") as follows: (i) 17% of the capital stock of Sofora in the first place and (ii) once the corresponding regulatory requirements have been met, the remaining 15% of WAI's stake in Sofora. Once both amortizations are realized, Fintech Telecom LLC will control 100% of the share capital of Sofora consolidating all the economic and corporate rights of the Company.
Resulting from the Reorganization and effective as of the Reorganization Effectiveness Date: (i) all the assets and liabilities of the Absorbed Companies shall be transferred to the Surviving Company at the values included in the respective Special-Purpose Unconsolidated Financial Statements, causing Telecom Argentina to acquire ownership of all rights and to assume all obligations and liabilities of any nature of Telecom Personal, Sofora and Nortel including (ii) Telecom Argentina shall be the successor of all activities of Telecom Personal, Sofora and Nortel.
Moreover, on March 31, 2017, the Board of Directors of Telecom Argentina S.A., Sofora Telecomunicaciones S.A., Nortel Inversora S.A. and Telecom Personal S.A. approved the Preliminary Merger Agreement by which they agree that Telecom Argentina will absorb by merger Nortel, Sofora and Telecom Personal, in accordance with the terms of Sections 82 and 83 of the General Corporate Law, and ad referendum of the corporate and regulatory approvals established in said Commitment.
Regarding the aforementioned corporate reorganization and in order to facilitate the merger process by concentrating the entire capital stock of the Absorbed Company (Telecom Personal) under the ownership of the Surviving Company (Telecom Argentina), The Board of Directors of Nortel and Telecom Argentina approved on March 31, 2017 the sale of 120,000 shares of Telecom Personal, held by Nortel, to Telecom Argentina, for the amount of P$ 4,000,000, -. As a consequence of this transaction, as of March 31, 2017, Telecom Argentina owns 100% of Telecom Personal.
Finally, The Board of Directors of the Company, resolved to summon a General Ordinary and Extraordinary Shareholders' Meeting of Nortel Inversora to be held on May 22, 2017 on the first call, in order to consider the corporate reorganization described herein and the documentation approved by the Board of Directors.
Other Relevant Matters
Summary of the Resolutions approved by the Ordinary and Extraordinary General Stockholders Meeting held on April 27, 2017
The Ordinary and Extraordinary General Stockholders Meeting held on April 27, 2017 resolved, among other issues:
1. to approve the Annual Report and Financial Statements as of December 31,
2016;
2. to ratify the payment of a provisional cash dividends of AR$ 540 million
approved by the board of directors on October 24,2016
3. to allocate the non-appropriated profit amount as of December 31, 2016,
of AR$ 1,652 million to the already existing "Voluntary Reserve for the
Future Distribution of Dividends";
María de los Angeles Blanco Salgado
Officer in Charge of Market Relations
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SOURCE Nortel Inversora S.A.
