By Rogerio Jelmayer
SÃO PAULO--Brazilian telephone company Oi SA (OIBR4.BR) will put
its controlling stake in Africatel Holdings B.V. up for sale as
part of the company's effort to raise cash to make an offer to try
to acquire TIM Participacoes SA, the Brazilian mobile phone company
controlled by Telecom Italia SpA.
Oi said late Tuesday that its board authorized the company's
management to take the necessary measures for the sale of Oi's
holdings in Africatel Holdings, representing 75% of the capital
stock of Africatel.
Oi also faces a dispute with the minority shareholder of
Africatel, called Samba Luxco, which informed Oi that it planned to
exercise an option to sell its 25% stake in Africatel shares.
"Oi will lead the sale process even though Oi believes that it
is in the interest of both shareholders of Africatel to maximize
the value of their investments that such a sale is executed in a
coordinated manner with Samba Luxco S.a.r.l, an affiliate of Helios
Investors L.P., which holds the remaining 25% of the capital stock
of Africatel," Oi said.
Oi is also committed to work with its local partners in each of
the operating companies in which Africatel has invested to ensure a
coordinated transition of ownership, it added.
The sale process comes amid Oi's efforts to attract local rivals
to help in buying and splitting up TIM Participacoes SA, according
to two people familiar with the plan.
In August, Oi said it hired investment bank BTG Pactual to
arrange a deal, involved a possible acquisition of TIM
Participacoes. Then, a source close to the talks said that bank had
contacted Telefónica Brasil SA and Claro, the local unit of
Mexico's America Movil SAB, for a potential deal, since Oi can't
acquire TIM alone because of antitrust issues.
TIM has a market value of more than 30 billion Brazilian reais
($12.8 billion). Oi is already deeply in debt and plans to sell
noncore business assets to help finance the purchase, including
telecommunication towers in Brazil, some properties, and assets in
Africa that could be worth as much as $1.77 billion, said another
person with knowledge of Oi plans.
Write to Rogerio Jelmayer at rogerio.jelmayer@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires