Boston, MA 09/10/2014 (wallstreetpr) – According to reports, the involvement of America Movil SAB de CV (ADR)(NYSE:AMX) in Telecom Italia SpA deal can prove to be beneficial for Oi SA (ADR)(NYSE:OIBR). Recently OIBR won a powerful argument over its potential run of Telecom Italia SpA’s unit that is located in Brazil. Management of OIBR says that AMX’s involvement in this deal will help them getting analysts’ and investors’ support and trust in the long run.
When reporters asked from America Movil SAB de CV (ADR)(NYSE:AMX) management to comment on this deal, it said that it was looking forward to initiating a talk with Oi SA (ADR)(NYSE:OIBR) management in order to get the indirect 67% stake of Telecom Italia in TIM Participações SA. It is the second largest mobile phone company in the Brazil. If the closing price of company’s stock on Monday ($13.28 closing price) is taken into consideration, then the total stake of TIM is worth 21.5 billion reais ($9.4 billion). Its stock increased by 6.2% on Monday.
Last month OIBR said that it had tapped Banco BTG Pactual SA in order to place a bid for TIM. The company expressed its intention to linking up even other partners as well. Although analysts felt extremely happy to see OIBR’s initiative, but at the same time they also pointed questions in relation with its debt that is already 4-times of earnings before interest tax depreciation and amortization cost.
One more thing that doesn’t support Oi SA (ADR)(NYSE:OIBR) is its struggle to execute merger transaction with Portugal Telecom SGPS SA. It also shows the eagerness of companies to enter into Brazil, which has emerged as the biggest mobile market of South America. An emergency meeting of Portugal Telecom shareholders was called on Monday in which they decided to revise the terms of the deal. It became necessary after Espirito Santo Financial Group defaulted on loans offered by Portugal Telecom.