Between former Microsoft CEO Bill Gates and current Berkshire Hathaway CEO Warren Buffett lies the world's second-richest man: American Movil's (NYSE:AMX) Carlos Slim. With a business background instilled by his father, a prominent businessmen in his own right, Carlos Slim started his empire with successful investments in construction, mining, retail, food, and tobacco.

These early investments put Slim in an opportune place during Mexico's 1982 economic crisis. In a classic "buy when there's blood in the streets" move, the magnate bought major Mexican businesses Reynolds Aluminio and General Tire, and acquired large stakes in the Mexican arm of British American Tobacco and The Hershey Company in the aftermath. Those businesses gave Slim the capital and reputation to buy government-owned landline company Telmex from the Mexican government in the early '90s.

Eventually, Slim would found American Movil, the company that would propel him to the top of the billionaire's list. But now AT&T (NYSE:T) appears to want to take on Slim in his home country. By paying $2.5 billion to acquire Mexican wireless provider Iusacell, the company plans to mount the most serious challenge to Slim's empire yet.

The Mexican wireless landscape
AT&T has its work cut out for it. Slim's American Movil is the parent company of Telcel and a massive 70%-80% share of the Mexican wireless market. That figure is quickly falling, due to regulatory pressure. The next closest provider, Movistar, has an estimated 10%-15% of the market. AT&T's newly owned entity, Iusacell, comes in third, taking less than 10% of the wireless market. And although the wireless penetration rate is only 61%, allowing AT&T a runway for organic growth, the company needs to add a larger percentage of new subscribers than the current makeup implies.

That said, AT&T is excited for the opportunity. It appears AT&T will use its United States network to pull in Mexican subscribers. CEO Randall Stephenson commented [emphasis added]:

Our acquisition of Iusacell is a direct result of the reforms put in place by President Pena Nieto to encourage more competition and more investment in Mexico ... Iusacell gives us a unique opportunity to create the first-ever North American Mobile Service area covering over 400 million consumers and businesses in Mexico and the United States. It won't matter which country you're in or which country you're calling -- it will all be one network, one customer experience.

President Nieto's larger reforms could help AT&T
There's a reason why Stephenson specifically mentioned President Nieto's reforms; the president and Carlos Slim have had disputes in regards to his near-monopolistic telephone empire. Last year President Nieto's government sued Slim's fixed-line Telmex for charging illegal fees; at the basis of the lawsuit was Telmex charging money for subscribers in order for their names to be left out of a telephone directory, citing their constitutional right to privacy.

Carlos Slim. Source: Wikimedia Commons

However, the biggest reform was the company's divestiture to drop its share of mobile phones to below 50% in order to appease regulators. So, in a weird way, Slim's American Movil wants competition, but probably not from America's second-largest provider. Considering AT&T has the wherewithal to build out an excellent national network, lower phone rates (Mexico has among the highest phone rates in the developed world), and improve intercountry communications, Slim risks losing considerable wealth at the hands of AT&T.

Even worse for Slim, AT&T wants to go into television as well
AT&T's interest in Mexico goes further than mobile phones. If approved, the DirecTV merger gives the company a strong foothold in Mexico through DirecTV's Latin American operations. AT&T parted with its $5.6 billion stake in American Movil to smooth the way for this deal. The silver lining in President Nieto's reforms to Slim was they cleared the way for him to get into pay-TV and broadcasting. However, if AT&T is able to offer a better product, this could be all for naught for the world's second-richest man.

Overall, Slim has been able to acquire a substantial amount of wealth in a country that isn't that rich. Out of the world's 20 richest people, Slim is domiciled in the poorest country (if one excludes Hong Kong from greater China for this example). He's been able to amass that fortune by monopolistic power, but if AT&T executes here Slim could perhaps be facing the biggest risk to his fortune.