Last year Brookfield Asset Management Inc and the Canada Pension Plan Investment Board (CPPIB) were said to be mulling a bid for the fibre unit of Brazilian telecom firm Oi SA. Now press reports suggest that one of these two – the CPPIB – is going ahead.
According to Bloomberg, the CPPIB is joining a fund managed by Banco BTG Pactual, the largest investment bank in Latin America, to make a binding offer for Oi’s fibre unit later this month.
However, Brazilian tower operator Highline do Brasil II Infraestrutura de Telecomunicacoes, a portfolio company of US private equity firm Digital Colony, and Ufinet, a neutral fibre optic operator in the wholesale telecommunications market, are also expected to bid.
Oi is planning to sell as much as 51 per cent of its subsidiary, known as InfraCo, with a value for the whole company of at least $3.6 billion, though there have apparently been a large number of non-binding proposals, encouraging hopes from Oi that this minimum could be exceeded by a large margin.
After receiving the binding proposals for InfraCo, Oi plans to schedule an auction to sell its fibre unit.
As we have reported often in the past 12 months, Oi is currently in the process of selling assets to raise capital to pay its debts. In December, Oi sold its mobile assets to a consortium of rival operators Claro Brasil, Telefonica Brasil (Vivo) and TIM Brasil.
