Business

Brazilian carrier Oi signed an exclusive deal with Highline for mobile assets

A division of U.S private equity firm Digital Colony, Highline offered a better proposal than rivals, said Oi

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  • Oi said that Highline has presented the best offer for its mobile assets;
  • Highline has also delivered a binding proposal to acquire Oi’s cellular tower unit for BRL 1.08 billion.

The Brazilian telecom company Oi signed an exclusive agreement with Highline do Brasil, a division of U.S private equity firm Digital Colony, for its mobile assets, as it negotiates the sale of its mobile operation.

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If Highline binding proposal is accepted, the private equity firm will have the right to cover other proposals. Competitors like TIM, Vivo (Brazilian Telefonica) and America Movil‘s Claro, had submitted a joint bid for Oi’s mobile assets and planned to slice the operations between the states to avoid market concentration and have the business barred by regulators. But, according to Oi, Highline’s proposal was above the defined minimum price, estimated at BRL 15 billion ($2.93 billion), says O Globo.

Highline’s plan, according to Teletime, is to buy Oi as a whole and become an operator not of services to the end-user, but of the network. The company has also delivered a binding proposal to acquire Oi’s cellular tower unit for BRL 1.08 billion. According to Valor Investe, it opens the discussion on the offer of a “neutral network” in the mobile market in Brazil.

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In this model, the company, focused on offering telecommunications infrastructure, negotiates the sharing of the radio frequencies it holds to reinforce the service coverage of traditional operators, which serve the end-user. It already happens in Mexico, for instance.

Meanwhile, Oi intends to use the asset sale proceeds to fund its growing broadband fiber unit and pay off debt as part of its effort to emerge from bankruptcy protection, says Reuters.