Telefonica cements deal for Vivo Brazil

Spanish carrier Telefónica said Wednesday that it has finally reached an agreement with Portugal Telecom over the acquisition of Brazilian operator Vivo.

Earlier this month at a general shareholder meeting at Portugal Telecom, a majority (73.9 per cent) of votes were submitted in favour of Telefónica’s acquisition of Portugal Telecom’s stake in Brasilcel, which in turn controls Vivo. But the Portuguese Government stepped in with its “golden share” and blocked the transaction. However the European Court of Justice ruled that the Portuguese Government’s use of the golden share was unlawful clearing the way for a deal to go ahead.

Official figures haven’t been disclosed but the deal is expected to total around €7.5bn, yet another increase on the original offer of €5.7bn, underscoring the importance of the stake to Telefónica.

Meanwhile, Portugal Telecom is reported to be already moving on, with its eye on a stake in Brazilian competitor to Vivo, Telemar PCS, otherwise known as Oi.

Oi is the smallest of the leading players, with 42.3 million users at end June, according to Informa’s WCIS. TIM had 43.7 million users while Claro had 46.9 million and Vivo had 55.8 million.