Private equity firms Apax Partners and Bain Capital have made a €7.075bn (US$8.8bn) offer to Brazilian telco Oi for its Portuguese assets, challenging an earlier bid from telecoms holding Altice.
At the beginning of the month, Luxembourg-based Altice,…
Private equity firms Apax Partners and Bain Capital have made a €7.075bn (US$8.8bn) offer to Brazilian telco Oi for its Portuguese assets, challenging an earlier bid from telecoms holding Altice.
At the beginning of the month, Luxembourg-based Altice, owned by billionaire Patrick Drahi, offered €7.03bn for Portugal Telecom (PT) to expand its presence in the country, where it already owns cableco Cabovisao and telecoms unit Oni.
Like Altice’s offer, the Apax-Bain bid includes an earn-out payment of €400m related to future revenue generation as well as €400m related to EBITDA generation, but excludes Oi’s African operations and €897m in debt that Rioforte owed to PT and defaulted on.
If either bid is successful, it would break up the combination between Oi and PT, which was announced in October last year.
Today’s announcement comes just a few days after Terra Peregrin’s €1.2bn (US$1.4bn) offer for Portugal Telecom SPGS, which holds a 25.6% stake in the combined Oi-PT entity.
The Portuguese investment vehicle of Angolan entrepreneur Isabel dos Santos, who has a controlling stake in Portugal’s second-largest carrier Nos, filed the bid on Sunday.
However, Oi said the offer was “unacceptable”, as it imposed a number of conditions which would delay the ongoing Oi-PT merger and prevent Oi from selling assets.
Yesterday, a dos Santos’ spokesperson reportedly said she was willing to change some of the terms to convince PT SPGS shareholders and address Oi’s concerns.
According to analysts, dos Santos’ move is aimed at giving her a say in the future of her Portuguese rival as well as in Oi’s African operations.
Indeed, a deal could potentially give her greater control over Unitel, Angola’s largest wireless player, in which she already has a 25% stake. Oi is currently looking to sell its own 25% interest in the Angolan telco, which it owns via Africatel, but has yet to find a buyer for the asset.
Highly-leveraged Oi is looking to raise funds to pay down its R$46bn (US$19bn) debt and expand in its domestic market, where the company is reportedly preparing a joint bid with rivals America Movil and Telefonica for Brazil’s second-largest player, Telecom Italia-owned TIM Brasil.
