Personal Net Worth: Success Story of Carlos Slim Helú
Billionaires around the globe have their own story behind, and sometimes, somehow it is fascinating to see the foundation of their success. In this blog post, you’ll learn about this individual who owns a grocery store, the biggest national construction outfit and one of the biggest cell phone provider in their country.
Carlos Slim Helú is one of the richest people around the globe. As of January 7, 2019, Carlos Slim has a net worth of $59.6 billion. Carlos Slim owns and controls America Movil, America’s biggest cell phone provider company.
Carlos Slim’s early life
Julián Slim Haddad and Linda Helú Atta, Carlos Slim’s parents, are both Maronite Catholics of Lebanese descent. On January 28, 1940, Carlos Slim was born in Mexico City, Mexico. His father was sent to Mexico during the year 1902 avoiding getting draft into the Ottoman Army. Upon arrival in Mexico, his father changed his name to Julián Slim Haddad.
His family became a part of a small commercially prosperous Lebanese Christian community streamed to Mexico during the late 1800s and early 1900s.
Carlos Slim’s father was a natural, opening dry goods store during the year 1911, in which grew to a more than $100,000 worth of merchandise ten years upon starting. With profits from their successful dry store, his father bought a prime real estate in Mexico City for a pension in the 1910-1918 Mexican Revolution.
Julián Slim’s investments in real estate with his continued success in retailing and wholesaling made their family rich bringing him to a net worth of more than one million pesos.
Since Carlos Slim’s young age, he took an interest in his father’s business. His father on the other side is happily obliged giving him lessons about management, keeping detailed and accurate financial records and reading financial statements.
When he was only 13 years old, Carlos Slim’s father died (1953). Upon his father’s death, he continued to work for his father’s company, which soon be passed on to him. When he graduated high school, he enrolled to the National Autonomous University of Mexico, studying civil engineering while teaching linear programming and algebra.
Even with civil engineering studies, he took a series of courses in economics in Chile upon graduating in 1961. He also went to finance afterward while working and being a stock trader in Mexico City.
During the year 1965, aged 25, his trading career profited him around $400,000 which is more than $3 million in our present dollar. He then used the money to open a brokerage firm he named Inversora Bursátil.
Carlos Slim’s biggest opportunity came during the early 1980s, a steep decline in oil prices. The capital was fleeing in Mexico, yet Slim purchased a number of companies with depressed valuations. That includes Cigatam (Mexico’s second-largest cigarette maker), General Tire, Reynolds Aluminum and the Sanborns chain of stores.
Slim literally have hundreds of companies, most through Grupo Carso SAB, Slim’s global conglomerate. Grupo Carso had stakes enterprises as diverse as Elementia (one of the largest cement companies in Mexico). Retail includes Sears and Saks Fifth Avenue, energy and construction (through CICSA) and automotive (Through Grupo Condumex). Slim also had a stake in The New York Times.
Carlos Slim’s biggest wealth piece comes from a telecommunication servicing. He actually owns América Movil, which is formerly Teléfonos de Mexico, or Telmex. It is the old telephone copyright in Mexico. During the 1990s, Mexico government privatized the company, in which Slim became one of the initial investors. Its price was $1.8 billion, half of it was put up by Grupo Carso with a 20% stake. Carlos Slim had greater authority than Grupo Carso and took over Telmex.
América Movil during the year 2012 took over Telmex and reached its way as a privately held subsidiary. Through Telcel subsidiary, América Movil had a market share of about 70% of the mobile phone line market, with 80% of landlines in Mexico. Because of the anti-monopoly regulations in Mexico, the company was set to sell assets bringing its market share below 50%. But Slim is probably not upset at the assets, including the cell phone towers, which could easily bring in $8 billion or more, a profit on the main investment.
Slim’s telecom subsidiaries aren’t limited in Mexico. In the United States, TracFone is the company’s most known brand, a low-cost cellular phone operator. In Austria, the Telekom Austria, the company actually owns the majority stake of the brand. Carlos Slim’s telecom servicing empire widens at almost every country in Latin America.
But Slim often explains his strategy of reinvesting profits to the growth of the business itself makes the company what it is today. For instance, Telmex invested billions throughout since it begun under Slim’s authority install an updated fiber network during the 1990s. That brings the company in a place offering high-speed internet service.
It was Slim’s business deal mark through his life, to purchase an asset, reinvest and sell at a greater profit.
Slim’s Marketplace Domination and its challenges
During the year 2015, according to Forbes Slim became the second wealthiest man in the world. But he fell fourth place during the year 2016 Forbes Billionaires list, and it continues in the year 2017, slipping towards the sixth place.
The recent Mexican regulation and weak peso damaged Slim’s business tremendously. As years pass by, the Mexican government inclined its effort to halt Slim’s domination in the marketplace. During the year 2014, Enrique Pena Nieto, Mexican President at the time, signed a law aiming to increase competition in the telecommunication industry.
The law mainly forced América Móvil to submit to its special rules being the main competitor in the telecom industry. América Móvil isn’t able to charge fees to their smaller competitors if they use the company’s network and the firm is to share their infrastructure including their cell phone towers to their competitors. Slim said that the regulations are forcing América Móvil to promote competitors, and during August 2017, Mexico’s Supreme Court ruled that allowing competitors to use América Móvil network with free of charge is unconstitutional, but it didn’t require other companies to pay retroactive fees.
According to the Organization for Economic Cooperation and Development (OECD), in 2016, América Móvil holds 72% of the Mexican wireless market. But AT&T is using billions to compete against América Móvil. Further challenges now lie ahead as this giant telecom grows in the upcoming years.