Telefonica has finally secured control of Brazilian carrier Vivo, agreeing a deal last night to purchase Portugal Telecom’s share in the Brasilcel joint venture that controls the cellco.
The Spanish telco upped its bid for the 50% Brasilcel share for a third time, finally agreeing to shell out €7.5 billion, and both carriers have agreed the transaction in principle, Spanish daily El Pais reports.
Although the deal must still be approved by the boards of both firms, it has already been cleared by the Portuguese government, El Pais said.
Brasilcel holds a controlling 60% stake in Vivo.
Telefonica last week threatened to dissolve the joint venture after the deadline for its previous €7.1 billion offer passed on July 16.
That offer was blocked by the Portuguese government in June, despite the majority of Portugal Telecom shareholders voting to accept it.
Both carriers viewed Vivo as a key growth opportunity that would help them stave off falling revenues in their domestic markets, WSJ.com reported.
Portugal Telecom will use half of the funds it receives for Brasilcel to up its stake in rival Brazilian cellco Oi to between 20% and 25%, El Pais said, while Telefonica is widely tipped to combine Vivo with Telesp, its fixed-line business in the country.