Telefónica Wins Vivo Battle
Spain’s Telefónica SA won full control of a Brazilian wireless joint venture it had with Portugal Telecom SGPS SA after a sweetened bid of €7.5 billion ($9.75 billion) ended months of struggles between the two Iberian telecoms.
Portugal Telecom said it would use some of the proceeds from the sale of its stake in Brazil’s Vivo Participacoes SA to buy a 22.4 percent stake in another Brazilian wireless carrier, Oi.
Telefonica and PT both said Wednesday their boards had approved the transaction, which was initially vetoed by the Portuguese government.
Brazil has become a battleground for Portugal Telecom and Telefónica, with both companies increasingly drawn to the high-growth region as revenue declines in their mature home markets and they suffer the lingering impacts of a severe recession. The country’s young population and relatively low mobile penetration rates also make it a prime market to pick up new wireless and Internet customers.