Brazil’s newest GSM operator, Oi, has announced plans to purchase fellow Brazilian cellco BCP as part of a strategy to expand its operations on a national scale. Oi, which is owned by fixed line incumbent Telemar, entered Brazil’s mobile market in June 2002 as the country’s first GSM operator; in the first six months of operation it claimed to have signed up over a million customers, at a rate of around 170,000 subscribers a month. Already operating in 16 Brazilian states, including Rio de Janeiro, Espirito Santos and Minas Gerais, Oi sees the purchase of BCP as a chance to gain a footing in Sao Paulo, the country’s most lucrative market.
BCP’s owners BellSouth and local group Safra have been looking to sell the cellco since it defaulted on a USD375 million debt payment a year ago. It now has debts totalling BRL7 billion, although this has not discouraged companies from being interested in acquiring it; other potential buyers include America Móvil subsidiary Telecom Americas, fixed line telco Brasil Telecom and Telecom Italia Mobile (TIM), all of which are also looking to enter the Sao Paulo market. At the end of 2002 BCP could claim around 2.8 million subscribers in its operating regions I and X.