By Alastair Stewart Of DOW JONES NEWSWIRES SAO PAULO -(Dow Jones)- Spain's Telefonica (TEF, TEF.MC) and France's Vivendi (VIV.FR, VIVEF) expect Brazilian telecommunications watchdog Anatel to review their requests for pre-approval of bids to take over local operator GVT Holding SA (GVTT3.BR) in the next week or soon after, according to people close to the companies. The approval is a pre-requisite of either offer for the local alternative operator going through. On Wednesday, Telefonica unveiled a bid of 50.50 Brazilian reals ($29.14), improving its previous offer of BRL48 and overshadowing the BRL42 offer made by Vivendi in September. According to people close to both companies, Anatel has indicated that it's council will vote on the request for approval at a scheduled meeting next week or at a special meeting. Either way, it will vote before the Spanish giant is due to hold an auction to buy GVT shares on Nov. 19, the people said. Anatel had no comment on the issue at this time, said a spokesman. Telefonica expects Anatel to approve the deal, Antonio Carlos Valente, chief executive of Telecomunicacoes de Sao Paulo (TSP), or Telesp, which is Telefonica's local unit, told reporters this week. Vivendi has said that it is reviewing its options and hasn't committed to making another bid for the asset. GVT is a relatively small operator, with around 2.6 million clients across Brazil's center-west, southern and northern regions. However, its business model concentrates on high-usage and high-margin customers, making it an ideal conduit for the expansion of Telefonica's fixed-line and broadband operations outside its base in Sao Paulo state. Meanwhile, for Vivendi, it presents a great opportunity to enter into the highly concentrated Brazilian fixed-line and broadband market. Telefonica appears ready to pay a premium to bar the entry of another major global competitor into the local telecom market. -By Alastair Stewart, Dow Jones Newswires; 5511 2847-4520; alastair.stewart@dowjones.com
