LetterOne Seeks To Invest $4 Billion in Brazil's Telecom Oi
October 26 2015 - 7:30AM
Dow Jones News
By Rogerio Jelmayer
SÃO PAULO--LetterOne, an investment firm lead by Russian
billionaire Mikhail Fridman, is planning to invest $4 billion in
Brazilian telecommunication company Oi SA, although the offer is
conditioned on the success of a potential merger with TIM
Participacoes, a local unit of Telecom Italia.
In August of 2014, Oi said that it was considering acquisition
or merger possibilities in Brazil, including a potential deal with
TIM Participacoes unit, and that it hired Brazilian investment bank
BTG Pactual to look at opportunities.
However, since then the company has failed to materialize a
deal. Oi has a large share of Brazil's fixed-line market, but has
fallen behind rivals in the mobile race and has been trying to make
up ground while cutting its heavy debt load.
Oi said on Monday that BTG received a proposal from LetterOne
"containing a proposal for the company to enter into exclusive
negotiations with LetterOne with respect to a potential transaction
with the objective of a possible consolidation of the Brazilian
telecommunications sector, involving a potential business
combination with TIM Participacoes."
"In accordance with the proposal from LetterOne, sent by BTG
Pactual to the Chief Executive Officer and Chairman of the
company's board of directors, LetterOne would be willing to make a
capital contribution of up to $4.0 billion in the company (Oi),
subject to the consolidation activities," Oi said.
Write to Rogerio Jelmayer at rogerio.jelmayer@wsj.com
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(END) Dow Jones Newswires
October 26, 2015 07:15 ET (11:15 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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