TIM, Vivo start discussions over Oi carve-up

11 Mar 2020

TIM Participacoes (TIM Brasil) and Telefonica Brasil (Vivo) have jointly informed their respective shareholders that they have contacted Bank of America Merrill Lynch – the financial adviser enlisted by debt-wracked rival Oi – to express their interest in ‘initiating negotiations targeting a potential joint acquisition of Oi Group’s mobile business’. The announcement notes that they are willing to acquire the business ‘in whole or in part, so that, in the event of the completion of the operation, each of the interested parties will receive a portion of that business.’

For its part, Oi has acknowledged: ‘The receipt of these preliminary, non-binding indications from third parties reinforces the company’s understanding that there is market interest for its mobile telephony operations. As of this moment, however, neither Oi nor any such third party has committed to any such disposition or executed any binding agreement in this respect.’

According to TeleGeography’s GlobalComms Database, Vivo closed out December 2019 with a market-leading share of 32.0%, narrowly ahead of Telecom Italia (TIM)-backed TIM Brasil (25.2%) and Claro Brasil (23.2%), a subsidiary of Mexican powerhouse America Movil (AM). Slightly adrift of its rivals is cash-strapped Oi – which file the largest bankruptcy request in Brazil’s history in June 2016 – with 17.2% of the market at end-2019.

Brazil, Oi, Telefonica Brasil (Vivo), TIM Brasil