The joint bid of TIM Brasil, Telefonica Brasil and Claro Brasil for Oi's mobile business has been declared the winner, with an offer of BRL 16.5 billion (EUR 2.7 billion). The three rivals increased their bid in July and entered exclusive talks with Oi in August. No higher bidders appear to have emerged, allowing the three companies to divide up the business amongst themselves.
Oi is selling the business as part of its debt restructuring process, along with other assets such as its data centres and DTH activities. The company said it may receive another BRL 819 million from the mobile buyers under proposed data transmission capacity contracts to be signed at closing.
The mobile assets will be segregated into three isolated and independent sets to be contributed by the Oi Group to three special purpose entities (SPE). Each of the buyers will acquire, at the closing, the totality of the shares of a single SPE. The buyers will receive clients, radiofrequency assets, and mobile access infrastructure rights and assets.
The transaction still requires the consent of the National Telecommunications Agency (Anatel) and the Administrative Council for Economic Defense (CADE). The companies aim to complete the deal in 2021.
Oi is the fourth-largest mobile operator in Brazil with just under 16 percent of total customers. The transaction is structured to ensure none of the other three operators becomes overly dominant or competition is disrupted following the acquisition.
The smallest of the three, TIM will take the largest share of the Oi business, paying BRL 7.3 billion for 40 percent, or around 14.5 million of Oi's customers. It also receives 54 percent of Oi's spectrum rights, equal to around 49 MHz, and 49 percent of its mobile access sites, equal to around 7,200 sites.
Telefonica Brasil, which owns market leader Vivo, will pay 33 percent of the purchase price, at BRL 5.5 billion. This gives it 29 percent of Oi's customers (10.5 million), 46 percent of the spectrum (43 MHz) and 19 percent of the mobile sites (2,700).
America Movil, owner of the second-largest mobile operator Claro, will pay the remaining 22 percent, at BRL 3.6 billion. It receives 32 percent of Oi's customers and antenna sites in return.
