Digital Colony to back Algar’s bid for Oi, report says

21 Jul 2020

Digital Colony Management, the US-based digital infrastructure investment platform of Colony Capital, is set to back Algar Telecom’s surprise takeover bid for Oi’s mobile assets, Veja reports. This development follows the confirmation that Claro Brasil, Telefonica Brasil (Vivo) and TIM Brasil submitted a three-way bid for the mobile assets of the financially stricken telecoms operator late last week. TeleGeography notes that regional player Algar already has heavyweight backing from Singaporean sovereign wealth fund GIC, which acquired a 25% stake in the Uberlandia-based telco in March 2018.

Previously, in December 2019 Digital Colony signalled its interest in the Brazilian marketplace, when it announced the acquisition of tower firm Highline do Brasil II Infraestrutura de Telecomunicacoes (Highline), from Patria Investments. Founded by Patria in 2012, Highline has a portfolio of wireless infrastructure assets, including macro towers, which spans all the major urban, suburban, and rural areas of Brazil. The company counts all of Brazil’s major mobile network operators, including TIM Brasil, Vivo, Claro and Oi as its customers.

As previously reported by TeleGeography’s CommsUpdate, in June this year Oi confirmed its intention to sell its mobile assets via a ‘competitive process’. Oi requires interested parties to submit sealed bids for 100% of its mobile unit, with a minimum price of BRL15 billion (USD2.9 billion). The mobile assets will be awarded to the bidder who offers the highest price above the minimum price, unless the second highest bid ‘provides greater legal assurances and certainty for the closing of the sale’.

Brazil, Algar Telecom, Digital Colony, Oi