Business

Brazil's telecom Oi approves reorganization plan and paves way for asset sales

The Brazilian telecom carrier is operating under bankruptcy court supervision since 2017

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  • TIM, Telefônica Brasil, and Claro, owned by Mexico’s América Móvil, have been in talks with Oi to acquire its wireless business;
  • The company proposed that their joint bid received “stalking horse” status, a priority over other bidders.

Creditors of Brazilian telecom carrier Oi, which is operating under bankruptcy court supervision, late on Tuesday approved amendments to its reorganization plan that will allow the sale of certain of its assets, according to securities filings.

Proceeds from the sale of Oi units including its wireless telephone business, data center operations and other telecom infrastructure will be used to repay lenders and make investments in the company, according to the filings.

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TIM, Telefônica Brasil, and Claro, owned by Mexico’s América Móvil, have been in talks with Oi to acquire its wireless business. They made a joint bid of BRL 16.5 billion ($3.08 billion) for the unit and the assets associated with it, according to public disclosures.

In the creditors’ meeting held on Tuesday to discuss amendments to the Oi’s reorganization plan, the company proposed that their joint bid received “stalking horse” status.

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That meant that if approved by the creditors, the amended reorganization plan would give bidders the right to top any other bids during the competitive process for the targeted assets.

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