Copel Telecom – Brazil’s only remaining state-owned telecommunications company – has finally been sold.
It was sold to Brazilian company the Bordeaux Investment Fund, for about $443.7, almost $185.25 million more than the minimum bid defined in the auction.
This may be due to the company’s unusually strong position in fibre optics. Copel Telecom had been, until the sale, part of the state-owned electricity distributor Companhia Paranaense de Energia (Copel). Copel’s telecommunications division is very strong in Paraná, where its social mission – which local press outlets say it achieved – was to bring optical fibre to 100 percent of the municipalities of the state, which is in the south of the country.
Owning this sort of infrastructure made Copel Telecom a leading name in optical fibre in Paraná, controlling nearly 70 per cent of all fibre connections in the state and enjoying strong consumer ratings. However, according to local press reports, its advantage over major competitors such as Vivo and Oi has been diminishing.
In any case, a lot of investment has been required to keep the company growing and competitive, so, in 2019, owner Copel announced a plan to divest its natural gas and telecommunications holdings to focus entirely on electricity.
Copel Telecom is still profitable, however, and the sale has evidently outstripped expectations.
As we reported in May, the planned sale of Copel Telecom would have happened a lot earlier if not for the coronavirus crisis and the Paraná engineers’ union filing an injunction (which was overturned). As for what happens next, at the moment the Bordeaux Investment Fund isn’t saying.