Ecuadorian state-owned telecoms operator Corporaciуn Nacional de Telecomunicaciones (CNT) is expected to absorb state-owned mobile operator Alegro PCS, state news service Andes reported President Rafael Correa as saying.

“The best option is for Alegro to be absorbed by CNT,” Correa was quoted as saying.

Alegro has recorded losses of US$220mn since it was formed in 2003. The operator was previously run by Swedish firm Swedtel and Italian company Vнa Advisors, both of which had their contracts revoked by the government.

Correa said Alegro’s losses are lower compared to previous years. Last year, the company’s losses reached US$13.5mn.

Alegro has been looking to find a strategic partner in a move to improve efficiency, and in October 2009 it signed a memorandum of understanding to form an alliance with Venezuela’s state-controlled telco Cantv. Early last year, Correa threatened that Alegro would be sold if it did not turn a profit within a year’s time.

CNT was formed by the merger of former state telcos Andinatel and Pacifictel in November 2008. The operator announced it expects total investment this year will reach US$256mn.

According to latest figures from the country’s telecoms supervisory body Supertel, Alegro had 325,720 subscribers at the end of January, coming in a distant third behind operators Porta and Movistar, which at the same time had a respective 9.39mn and 3.78mn subscribers.

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