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‘Oi in talks over sale of mobile unit’
Posted on Friday, 20 September 2019 08:51
Brazilian telecoms player Oi has entered discussions over a potential divestment of its mobile network to Telecom Italia and Telefonica, according to Reuters.
Citing five people with knowledge of the situation, the news provider said the firm hopes to raise in excess of BRL 10.00 billion (USD 2.42 billion) from the divestment, which it is carrying out in a bid to avoid insolvency.
The sources, who did not wish to be identified as the discussions are confidential, said proceeds have been earmarked for improving its fibre-to-home broadband service, with one person noting that, while a sale of the whole business has not been ruled out, it is unlikely.
However, Telecom Italia and Telefonica could have some competition, with two other people telling Reuters that negotiations are also underway with AT&T and an unspecified Chinese suitor.
A spokesperson for Telecom Italia has moved to pour cold water on the speculation by denying that talks are taking place with Oi, while none of the other parties have made any statement on the matter.
Any deal may not be without its hitches; Reuters cited two sources as saying Brazil’s antitrust regulators could look to block a sale of the mobile network to one or two carriers who already have a presence in the country.
In addition, a separate person told the news provider that chief executive Eurico Teles is not in favour of a sale of the mobile unit, nor are certain unspecified shareholders.
Oi describes itself as one of the world’s largest telecom providers.
The company offers fixed and mobile broadband, pay television, data transmission and internet provider services to customers in 5,565 cities and also operates over 2.00 million public WiFi hotspots in locations such as airports and shopping centres.
It posted net operating revenue pf BRL 956.83 million for the first half of 2019, down from BRL 1.95 billion over the same period of last year.
© Zephus Ltd