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Oi receives new bid for mobile assets
Posted on Wednesday, 29 July 2020 11:45
Brazilian telecommunications player Oi said it has received a binding offer for its mobile assets, which has been on the block since September of last year.

The new approach is from Telecoms Tim Participacoes, Telefonica Brasil and Claro and is valued at BRL 16.50 billion (USD 3.20 billion).

In September 2019, five people with knowledge of the matter told Reuters that discussions were underway with Telefonica and Telecom Italia over a potential divestment of the mobile network as Oi sought to avoid insolvency.

The report suggested that preliminary discussions were also taking place with AT&T and an unknown Chinese suitor at that time.

Tim, Telefonica and Claro’s approach is currently being evaluated by Oi, which said it was keeping previous agreements with prospective buyers; it is in exclusive talks with Highline do Brasil.

Proceeds of the transaction have been earmarked for helping the firm to exit bankruptcy protection.

Oi describes itself as Brazil’s leading telecommunication services provider.

The company provides fixed and mobile, broadband, pay television, data transmission and internet provider services, as well as other corporate and wholesale services.

Its customer base numbered 57.10 million, as of the end of 2018.

However, in 2016 the firm was forced to file for bankruptcy protection; Financier Worldwide reported that the filing was the largest in Brazilian history.

It reported debts of USD 19.00 billion, having failed to agree an out-of-court restructuring deal with its creditors.

A purchase of Oi’s mobile network at BRL 16.50 billion would be the seventh-largest deal targeting a provider of wireless telecommunications services to have been announced worldwide since the beginning of 2020, according to Zephyr, the M&A database published by Bureau van Dijk.

The largest of all was worth USD 38.71 billion and took the form of a merger between Virgin Media and o2, which was signed off in May.

© Zephus Ltd