Telefonica bids BRL 20.1 billion for Vivendi's GVT

Telefonica has made a bid to acquire GVT, the Brazilian broadband operator owned by Vivendi, for BRL 11.96 billion cash and a 12 percent stake in the new Telefonica Brasil, after its merger with GVT. Based on the current value of Telefonica Brasil, the offer values GVT at BRL 20.10 billion (EUR 6.70 billion). The 60 percent of the offer in cash would be financed via a capital increase at Telefonica Brasil, subscribed by Telefonica in proportion to its current stake of 74 percent in the company.

 

Telefonica has also offered Vivendi its stake in Telecom Italia as partial payment. Telefonica still holds 1.11 billion shares in the Italian operator, equal to 8.3 percent of its voting rights./p>

Vivendi confirmed it received the offer and the details. While underlining that "none of its subsidiaries are for sale", the French company said its supervisory board would consider the Telefonica offer at its next meeting, in the best interests of its shareholders and the GVT employees.

A merger of Telefonica and GVT would create Brazil's largest broadband operator. The latest figures for June from market regulator Anatel show that Telefonica had 4.37 million broadband customers, equal to 18.81 percent of the market, and GVT had 2.76 million, equal to a 11.89 percent market share. Their closest rival was Oi, with 6.56 million customers. Telefonica is already the largest mobile operator in Brazil.