Hedge fund Millennium makes big bet against Carlos Slim’s América Móvil
Short position worth $320mn disclosed following hefty share price decline
US hedge fund Millennium Management has amassed a $320mn bet against Mexican billionaire Carlos Slim’s telecoms empire amid a sharp fall in the company’s shares.
The sizeable short position pitches the firm led by founder Izzy Englander against one of the largest telecoms companies in the world, with operations across Latin America and in central and eastern Europe through its stake in Telekom Austria.
The company’s shares have fallen 18 per cent since May, giving it a market value of roughly $62bn. It is controlled by the family of 83-year-old Slim — once the world’s richest man — with roughly 53.2 per cent of the company’s shares according to its 2022 annual report.
Slim’s children and their spouses have long been in top positions at his companies, with some of his grandchildren now also involved. The family is currently worth about $93bn, making him the richest person in the world outside the US, according to Forbes.
Despite a 2013 constitutional reform designed to curb the company’s dominant position, América Móvil still has a market share of more than 60 per cent in Mexico’s mobile market. President Andrés Manuel López Obrador has done little to foment competition in the private sector and even said he wanted to abolish the independent telecommunications regulator, which he sees as a neoliberal waste of money.
Millennium, which manages $60bn in assets, has a short position worth 0.52 per cent of América Móvil’s stock, according to a filing with the Spanish markets regulator on Wednesday. The company’s main stock listing is in Mexico, but it also trades on a Spain-based venue for Latin American shares, putting it within the scope of the EU’s short selling disclosure regime.
Millennium and América Móvil declined to comment.
Analysts said the size of Millennium’s bet was striking, even for one of the world’s biggest hedge funds.
“The magnitude of the América Móvil short position is not only uncommon for Millennium but is also a rarity among other money managers,” said Ivan Ćosović, founder of data group Breakout Point.
Millennium is structured differently to many other hedge funds, and doesn’t take big bets based on the view of a few senior decision makers at the top of the fund. Instead, the hedge fund is split into many different teams and each is allocated capital to bet on different markets and strategies.
Analysts at Citi upgraded the stock to a “buy” rating two weeks ago after the initial price decline, which they said was sparked by concerns over higher capital spending, betting the company’s buyback program would speed up in the second half of the year.