Conditions may collapse PT deal

26 Sep 2006

Sonaecom says it may walk away from its proposed takeover of Portugal Telecom if overly stringent conditions are placed on the deal by regulators. Soneacom – the telecoms arm of Portuguese utility group Sonae – has made a EUR11.1 billion(USD14.1 billion) hostile bid for its larger rival, but is still awaiting the approval of competition authorities. Reports suggest that market watchdog AdC may want to impose strict conditions to ensure that the deal does not impact on competition in the telecoms sector; these could include forcing Sonaecom to sell off PT assets such as its fixed line or cable networks, and this may signal the end of the deal. A Sonaecom spokesperson told Reuters: ‘We are considering the possibility of not going ahead with the operation’.

Portugal, Optimus (Clix)