The planned merger of Millicom (operating as Tigo) and Liberty Latin America in Costa Rica has been stopped by the country's regulator.

Superintendencia de Telecomunicaciones (Sutel) denied the approval of the merger, announced in August last year, based on the grounds that it could negatively harm competition.

The agreement sought to combine the operations of both firms in the country, with an approximate participation of 86 percent for Liberty and 14 percent for Millicom. The key focus for the merger would be to drive investments in fiber optic networks

However, Sutel has expressed concerns about the possible negative impact that the combination could have on competition in the Costa Rican telecommunications market, thus motivating its rejection of the merger.

In view of this situation, both companies have filed an appeal and are awaiting a quick resolution, as they seek to reverse Sutel's judgment.

Currently, the case is in the process of regulatory evaluation, with the expectation of a response that could define the future of one of the most relevant mergers in the telecommunications sector in the Central American region.

Liberty Latin America stated that the transaction would accelerate the transition to FTTH (fiber-to-the-home) and expand the supply of high-speed services for users. Millicom, meanwhile, highlighted the synergies and efficiencies that the alliance would generate to improve competitiveness and options for customers in Costa Rica.