The struggling Latin American business Lumen Technologies announced its novel commercial deal with Stonepeak.
It will divest its LATAM business. The firm will now focus on driving its business services and telecom offerings.
The telecom service provider had struggled to return to financial growth in recent years and was devastated largely owing to large dips in revenue due to the pandemic.
The Latin American business will now operate independently and a U.S headquartered company of Stonepeak.
Lumen said, according to the deal, the telecom provider’s leadership team and organization will not be replaced. Hector Alonso, Lumen’s regional president, will continue to head the firm. Lumen will also maintain its strategic partnership with LATAM and serve joint customers in the region.
The deal includes reciprocal reselling and network arrangements. The companies will use each other’s data centers, network infrastructure, and other assets. Post completion of the transaction, the customers of Lumen will work with Stonepeak Company.
Stonepeak will serve the customers in Latin America. The transaction will allow the LATAM Company to autonomously serve its customers.
It will have the opportunity to act according to the evolving market conditions in the Latin American regions.
The total revenue of Lumen Technologies in the recent Q1 2021 earned total revenue of $5.03 billion the total earnings per share were weakened by 45%.
The enterprise segment also suffered a huge loss which forced the company to sell its business to Stonepeak.