American Tower, Algar buy CEMIG Telecom assets; ‘strategic discussions’ underway at Nextel

9 Aug 2018

Infrastructure firm American Tower Corp and regional operator Algar Telecom have been confirmed as the buyers of the CEMIG Telecom assets put up for sale by Brazilian state-run utility Companhia Energetica de Minas Gerais (CEMIG). At an auction held at CEMIG’s headquarters in Minas Gerais, American Tower won ‘Lot 1’ (comprising assets in Minas Gerais, Sao Paulo and Rio de Janeiro) with a bid of BRL571 million (USD152 million), while Algar offered BRL78 million for ‘Lot 2’ which included infrastructure in Ceara, Bahia, Pernambuco, Goias and Belo Horizonte. The successful auction, which attracted 14 bidders – including all of the country’s major players – is expected to spur a renewed spell of M&A activity in Brazil’s telecoms space.

The next Brazilian telco likely to be sold is Nextel Brasil, and its US-based majority owner NII Holdings has now confirmed that it has commenced ‘strategic discussions’ over the future of the unit. The admission was made during a conference call with analysts to discuss its 2Q18 results. The National Telecommunications Agency (Agencia Nacional de Telecomunicacoes, Anatel) is expected to raise spectrum cap limits in the fourth quarter of 2018, which will speed up a potential sale. Rothschild & Co is advising NII on the sale process.