Telecom Italia open to all options in Brazil mobile consolidation

jueves 12 de noviembre de 2015 13:49 GYT

* Prospect of Brazil mobile consolidation comes back to fore

* Telecom Italia CEO says will be "pragmatic, rational"

* Oi's financial health, regulatory issues remain obstacles

By Leila Abboud

BARCELONA, Nov 12 (Reuters) - Telecom Italia is open to considering a merger or sale of its Brazilian mobile business next year with domestic leader Oi, if the latter can clean up its debt and regulatory issues, Chief Executive Marco Patuano said.

The Italian carrier, which owns Brazil's second-biggest mobile operator Tim Participacoes, has not yet decided whether it would want to keep control in any combination with Oi, and is open to all options, he added.

The four-player mobile market in Brazil has been hit hard by the ongoing recession and decline of the real. The possibility of consolidation has come back to the fore in recent weeks after Russian investment company Letter One offered to inject up to $4 billion into Oi if a deal with Tim Brasil could be reached.

Letter One, which is backed by Russian billionaire Mikhail Fridman, has entered into seven months of exclusive talks with Oi to that end.

Sector executives from three of the four Brazilian telecoms companies said at an industry conference in Barcelona this week that the outcome would depend largely on when Oi could reduce its debt and rules are relaxed on the fixed-line telephony market over aspects such as universal coverage obligations.   Continuación...