The question of who gets the mobile unit of cash-strapped Brazilian operator Oi may have been resolved – but not necessarily in the way that many commentators may have expected.
According to TeleGeography’s CommsUpdate and Reuters, the best binding offer above the minimum price established for the assets has come from Brazilian tower operator Highline do Brasil II Infraestrutura de Telecomunicacoes. Highline has now been granted exclusivity in negotiations over the sale of Oi’s mobile business.
As readers will know, Highline became a portfolio company of US private equity firm Digital Colony last year. Digital Colony was mentioned earlier this week when the Brazilian press cited rumours that it was backing regional operator Algar Telecom’s takeover bid for Oi’s mobile assets. Readers will also be aware that Highline recently submitted a binding offer for Oi’s tower business.
We don’t know the value of Highline’s offer for Oi’s mobile assets, but it certainly exceeds the minimum requirement, which is said to be about $2.93 billion.
Highline describes itself as an independent infrastructure solutions provider for the telecommunications industry. Its core business is the construction and operation of a portfolio of sites for installation of communication antennas: towers, rooftops, indoor systems and street-level sites. The company counts all of Brazil’s major mobile network operators among its customers.
This is not the end of the Oi saga; the exclusivity period expires on 3 August. However, it can be extended. Certainly the bid, submitted via Oi’s financial advisor, Bank of America Merrill Lynch, puts Highline in a commanding position and makes the success of the joint bid of operators Claro Brasil, Telefonica Brasil and TIM Brasil more doubtful. It also begs the question of what will happen to Brazil’s fourth mobile operator when it comes under new ownership.