Telecom Italia Seeks Approval from Brazil for M&A talks
Published By : 05 Feb 2015 | Published By : QYRESEARCH
Italian telecommunications company Telecom Italia will seek approval from the Brazilian government to start talks regarding the acquisition of local competitor Oi. This was informed by two sources close to the matter.
Telecom Italia chief executive officer Marco Patuano on Thursday, after meetings held in Brasilia with industry and communication ministers last week, will be updating the Italian phone group board regarding the situation in Brazil at a meeting that has been called to review the new strategy plan of the telecom company.
In November last year, Telecom Italia had asked CEO Patuano to go over the feasibility of merging TIM Participacoes with Oi in order to create the No 1 telephone operator in Brazil. Investors have expressed their keen desire to know the result of the review.
One of the sources on Wednesday said that Telecom Italia is waiting for a signal from the Brazil government to allow it to begin any direct discussions with Oi. The other source revealed that on one hand, this strengthening of TIM Participacoes is being viewed with favor by officials. On the other hand, there are still some major issues that are yet to be resolved.
Telecom Italia has refused to comment on the matter.
The government in Brazil is at present mulling over debt and regulatory issues. It is also in talks regarding licenses and these could last until summer.
Telecom Italia is presently the only operator in Brazil who does not have a fixed line network. Last year, Telecom Italia lost out to Spain based Telefonica in a bidding war to acquire GVT, a Brazilian broadband operator.