Report: Telecom Italia values TIM Brasil stake at €13B

Telecom Italia has valued its 67 per cent stake in TIM Brasil at around €13 billion ($16.8 billion), amid reports that Brazilian operators Oi and America Movil are closing in on the Italian company's unit.

Citing unnamed sources, Bloomberg said this price--understood to be the minimum that Telecom Italia would accept--would value TIM Brasil at around €20 billion, which is 11 times the Brazilian unit's 2013 EBITDA figure.

America Movil told various media outlets that it plans to discuss making a joint bid for the unit with rival Oi. Oi already said in August that it is considering a bid for TIM Brasil. Telefónica, which operates under the Vivo brand in Brazil, is also widely expected to participate in any sale of TIM Brasil.

"Oi presented an offer for TIM and has said that they could include other operators," America Movil CFO Carlos Garcia Moreno told Reuters this week. "We have decided in principle to explore this option. We will be talking with them."

Telecom Italia CEO Marco Patuano has continued to stress that TIM Brasil remains a core asset, although he said a sale was one of several options.

The Italian company's Brazilian strategy has become more uncertain after its plan to buy Brazilian broadband operator GVT and merge it with TIM Brasil failed: GVT parent company Vivendi opted for exclusive talks with Telefónica, which offered €7.45 billion including €4.66 billion in cash for the unit. Telecom Italia's offer represented a total enterprise value of €7 billion.

Telecom Italia has also indicated that it might reconsider the planned sale of its stake in Telecom Argentina if the government there takes too long to approve the deal.

For more:
- see this Reuters article
- see this Bloomberg article
- see this separate Bloomberg article

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