Telefónica will bid offer to 20,100 million Brazilian Reais (equivalent to 6,700 million euros at current exchange rates) to acquire Vivendi’s Global Village Telecom (GVT) business in Brazil. The offer includes a cash consideration of 11,962 million Brazilian Reais and newly issued shares representing 12% of the share capital of the new Telefónica Brasil, after its combination with GVT.
Telefónica Vivo brand is the leader operator in the mobile wireless market in Brazil and is the leading broadband services provider in the city of Sao Paulo. Vivendi’s GVT is the most successful and fastest growing alternative operator in Brazil. Telefónica said the combination of Vivo and GVT would create the largest telecom operator in Latin America’s largest market.
Telefónica’s offer also envisages that, should Vivendi be interested in acquiring a stable stake in Telecom Italia, Telefónica could offer Vivendi the acquisition, in cash, of up to 1,110 million ordinary shares of Telecom Italia, currently representing a stake of 8,3% of the Telecom Italia voting share capital.
