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Friday, July 30, 2010

Financial Times, Wall Street Journal, Dagens Industri
Telefónica on Wednesday won full control of Vivo when it agreed to pay EUR7.5 billion (USD9.7 billion) for Portugal Telecom’s stake in the Brazilian mobile joint venture, ending three months of struggles. The Spanish operator, which increased its offer three times from an initial bid of EUR5.7 billion in May, paid 10.5 times EBITDA for PT’s stake in the jointly-owned holding company Brasilcel that controls Vivo. PT will use EUR3.8 billion of the proceeds to buy 22.4-percent of Brazil’s largest telecom group, Oi, and thereby maintain a strong position in the Brazilian mobile market. PT chairman Henrique Granadeiro said the Iberian operators had “achieved the impossible” by reaching agreements satisfying all interested parties. Telefónica’s chairman, César Alierta, said the agreement was “a unique opportunity to create value”. The deal was also welcomed by the Lisbon government, which had used its golden share and special state veto rights to prevent PT shareholders from selling the Vivo stake. FT reports that Telefónica posted first-half net profit of EUR3.78 billion (USD4.92 billion) compared with analyst expectations of EUR3.68 billion. Revenue was EUR29.05 billion versus EUR28.55 billion forecast by analysts. Telefónica reported that its Spanish unit continued to show signs of improvement. 

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