Telefonica has sold most of its stake in Portugal Telecom because of fears it would not be allowed to vote on its own offer to buy the Portuguese firm out of their Brazilian mobile joint venture Vivo. The Financial Times reports that the Spanish telecoms group is hoping that the undisclosed buyers of an 8% stake in Portugal Telecom will vote in favour of Telefonica’s EUR6.5 billion (USD9.1 billion) offer to buy the Portuguese company out of Vivo, Brazil’s largest mobile operator. Portugal Telecom shareholders vote on Telefonica’s offer next Wednesday.
Telefonica is left with a 2% stake in Portugal Telecom which it plans to retain. Based on Portugal Telecom’s share price, the 8% holding is worth about EUR640 million. Portugal Telecom said hedge fund TPG-Axon Capital Management, had bought a 4% stake in the Portuguese company. It also said that UBS, which is advising Telefonica on the Vivo deal, now held voting rights over 6% of the Portuguese company’s shares following a transaction on Thursday last week, up from 3% previously. Some of the shares are held by UBS on behalf of clients. UBS declined to comment.