Oi (Telemar) to issue USD2.2bn worth of promissory notes

3 Jul 2008

Brazilian telecoms operator Oi (Telemar) plans to issue promissory notes worth BRL3.60 billion (USD2.25 billion) in the domestic market, according to BNamericas citing a company report registered at securities regulator CVM. The company will issue 144 notes valued at BRL25 million each to finance its acquisitions, the statement said. The promissory notes will mature after 360 days.

Oi has agreed a BRL5.85 billion deal to acquire rival operator Brasil Telecom (BrT), but it needs the government to change the existing telecoms law to enable telcos to acquire fellow operators which have concessions in different areas of the country. On Thursday 12 June the Brazilian telecoms regulator Anatel approved the necessary changes, but the takeover is now awaiting final government approval. In order to guarantee that competition is not affected by the merger, Anatel has also ruled that companies holding concessions in more than one operating region must provide services on a national basis. It hopes this condition will stop telcos from cherry-picking lucrative densely populated areas at the expense of less attractive rural markets.

Brazil, Oi