Mexican billionaire and the world’s second richest man Carlos Slim’s telecommunications company America Movil SAB de CV (ADR) (NYSE:AMX) (NASDAQ:AMOV), announced Tuesday it has decided to sell assets in Mexico to lower its market share.

America Movil

The announcement comes amid Mexico’s Congress passing new laws to bolster competition and impose strict regulations in the telecom-sector.

America Movil’s move to appease regulators

Latin America’s biggest mobile operator America Movil SAB de CV (ADR) (NYSE:AMX) (NASDAQ:AMOV) has 272 million mobile subscribers in the region and around 70 million subscribers to fixed-line, broadband and television service. In its regulatory filing Tuesday, America Movil said it decided to divest some assets to a newly formed independent company, reducing its market share in Mexican landlines and mobile phones to below 50% to appease regulators.

The company’s board made the breakup decision based on a special committee’s recommendations. However, the measures require regulatory approval and may require the endorsement of shareholders.

America Movil SAB de CV (ADR) (NYSE:AMX) (NASDAQ:AMOV)’s move comes as Mexico’s Congress new laws impose strict regulations on dominant firms. The Carlos Slim’s company controls around 70% of the country’s mobile subscribers and fixed phone lines.

Sale to a new operator

Latin America’s biggest mobile phone operator’s divestment plans include the sale of mobile towers and related infrastructure to be operated and marketed by a separate company. America Movil said it would sell certain assets to a new independent operator with experience in telecommunications and the capacity to invest in the capital-intensive industry ‘to overcome the obstacle of insufficient investment by our competitors in Mexico”.

Earlier in March, Mexico’s telecommunications regulator declared America Movil dominant in mobile and fixed-line telecom and imposed measures including network sharing, while slashing the interconnection rates that Telcel charges competitors to complete calls. Moreover this week’s regulations passed by Congress further prunes the mobile interconnection rates to zero and phases out domestic long-distance charges.

Under the proposed law, America Movil would have 365 days to implement a breakup plan, though the company would still be subjected to its restrictions as the dominant carrier. While the Senate approved the law last weekend, the lower house of Congress voted yesterday in favor of the bill in general terms. Some analysts expressed surprise at the swift announcement made by America Movil Tuesday.

Carlos Slim and his family hold a 57% America Movil SAB de CV (ADR) (NYSE:AMX) (NASDAQ:AMOV) stake, representing over half of his $71.5 billion fortune. His holdings include an 8.3% stake acquired from AT&T Inc. (NYSE:T) last month for $5.6 billion.