Portugal Telecom, Oi preparing merger - report

News General Brazil 24 JUN 2013
Portugal Telecom, Oi preparing merger - report
Portugal Telecom and Brazil's Oi are working on a merger. The process is being negotiated by the controlling shareholders of the two telecommunications operators, according to Brazilian daily Folha de Sao Paulo. The paper claims that a decision has already been reached to join forces in order to create an operator present in the Portuguese-speaking countries with 101 million customers and annual revenues of BRL 64 billion. 

The business model has yet to be defined, but a purchase of Oi by Portugal Telecom in an all-stock transaction is likely. However, the paper added that there are risks of the operation not going through and cited Oi shareholder sources who deny the pending merger. 

Oi is controlled by a group of Brazilian investors, including Andrade Gutierrez and state bank BNDES. Portugal Telecom already holds a 22 percent stake in Oi, and its CEO Zeinal Bava was recently named the new CEO of Oi. Oi issued a statement denying the two companies were in merger talks. 

Categories:

General

Companies:

Oi,  Portugal Telecom

Countries:

Brazil,  Portugal

Tags:

M&A buyouts & divestments

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