Algar Telecom and GIC may challenge TIM and Telefonica over Oi
Last month, financially struggling Brazilian telco Oi officially put 100% of its mobile unit on the market, accepting bids worth ~$2.9 billion and above.
At the time of the announcement, it seemed likely that the two major Brazilian operators, Telefonica Brasil (Vivo) and TIM Brasil, would divide Oi’s mobile assets between themselves; indeed, formal discussions to this end were undertaken almost immediately.
However, now Brazilian media is reporting that local telco Algar Telecom, together with Singaporean sovereign wealth fund GIC, could well be making a move to purchase Oi’s assets itself. Indeed, rumours are circulating that the pair even intend to purchase Oi’s fixed line business, which is not formally up for sale.
Such a purchase would throw Algar Telecom into the national limelight, taking the Uberlandia-based telco from a regional operator to a national one. Algar’s operations are currently restricted to just 359 cities, with limited avenues for growth. The chance to purchase of Oi’s national infrastructure is an opportunity that may be too good to pass up.
However, such a purchase is far from assured – despite the financial might of its Singaporean business partner, Algar Telecom will still have to outbid the consortium of its far larger mobile competitors.
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