Oi Movel

History

2020: Claro Brasil Oi purchased Oi Movel for $3.23 billion

In the middle of December, 2020 TIM Participacoes, Telefonica Brasil SA and Claro Brasil won an auction for acquisition of Oi Movel company - cellular business of the largest Brazilian telecom operator Oi. The total cost of purchase was 16.5 billion reals ($3.23 billion), and the provided group of operators was the only participant of an auction.

The trio of winners who submitted the initial application in July, is going to separate assets of Oi Movel as soon as gets approval of the antitrust law. Oi which submitted the application for protection against bankruptcy in 2016 sells assets on account of debt repayment to creditors. Though Oi – one of the operators of fixed connection, largest in Brazil, the company seriously lags behind in mobile area and by the number of subscribers takes the fourth place.

The Oi telecom operator, largest in Brazil, sold cellular business of Oi Movel company for $3.23 billion

The companies stated that the basic price was 15.744 billion reals, and 756 million more reals were selected for financing of so-called "transitional services" which Oi will perform during 2021 to facilitate transfer of assets. TIM, Telefonica Brasil and Claro also offered Oi the long-term contract on lease of its telecommunication infrastructure.

TIM Participacoes, local division of Telecom Italia of SpA, will pay about 7.3 billion reals of the basic price and 476 million more reals for transition services. Telefonica Brasil, local division of the Spanish Telefonica of SA, will pay about 5.5 billion reals of the basic price and 179 million reals for services of a transient period. And Claro will pay 22% of total amount of 16.5 billion reals, and in exchange will receive 32% of a subscriber base of mobile business of Oi.

Earlier the LetterOne investment group which offered $4 billion for all business in general tried to purchase Oi, however the company refused.^[1]

Notes