Elliott Management Corporation (EMC), the hedge fund controlled by US billionaire Paul Singer, has been linked with a bid for debt-wracked Brazilian telco Oi. According to unverified media reports, EMC – which specialises in ‘distressed debt acquisitions’ – is said to be eyeing a BRL9.2 billion (USD2.8 billion) move for a 60% stake in the telecoms firm. EMC was reported to be in buyout talks with the stricken telco back in October 2016, but no deal was agreed.
If the reports prove to be accurate, EMC will have to fend off interest from Egyptian tycoon Naguib Sawiris, who – alongside creditors Moelis and FTI Consulting – presented Oi with an alternative debt restructuring plan last month. The proposal would see Sawiris, majority shareholder of Orascom Telecom Media and Technology Holding (OTMTH), invest US250 million in Oi, while a further USD1 billion would be raised by a public share sale. Sawiris is due in Brazil for talks later this month.
As previously reported by TeleGeography’s CommsUpdate, Oi filed the largest bankruptcy request in Brazil’s history in June 2016, after failing to reach an agreement with creditors. The filing, which covered Oi and six subsidiaries, listed BRL65.4 billion of debt and the company chose judicial reorganisation to preserve the value of its holdings and to continue providing service to its customers.