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Telefonica Makes $9 Billion Bid to Boost Brazilian Presence

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Telefonica has made a USD9 billion bid to expand its operations in Brazil as the threat of regulatory action over its cross shareholding in a rival Brazilian mobile network diminishes.

In a short statement, Telfonica said it is willing to offer EUR6.7 billion (USD8.99 billion in cash and shares for Vivendi's local subsidiary, GVT, and would then merge it with its own Vivo mobile network.

However, the offer is likely to have to be improved, as it is made up of just 60% in cash, which would still leave Vivendi as a substantial shareholder in the company, but without management control over it.

Complicating the deal is an offer for Telefonica to sell its 8.3% stake in Telecom Italia to Vivendi, if it wants it.

Vivendi said that it hadn't been actively seeking a sale, but will consider the offer.

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Tags: telefonica  vivendi  telecom italia  Brazil