Telefonica’s board will this week discuss the possibility of making an improved bid for Brazilian fixed operator GVT in anticipation of a rival bid from Telecom Italia (TI), according to a Bloomberg report.

A source said the new bid could value GVT at €8 billion and be presented prior to the board meeting of GVT owner, French media group Vivendi, on 28 August — and before TI formalises its offer.

Telefonica is thought to be interested in GVT to satisfy Brazilian antitrust watchdog Cade, which wants the company to either dispose of its interests in TIM Participacoes (which it has via the TI stake) or to find a new partner for its Vivo mobile business in the country.

Telefonica’s preferred route appeared to be the break-up of TIM Brasil and selling the firm’s assets to rivals. However, TI always maintained it wanted to hold on to the Brazilian operation.

The source added that no decision has yet been made and that Telefonica could yet stick with its original €6.7 billion offer, which includes Vivendi receiving the 8.3 per cent TI stake held by the Spanish group.

TI is thought to be putting together a €7 billion bid, which would see its TIM Brazil division merge with GVT and see Vivendi receive a 20 per cent stake in the Italian incumbent as well as holding a stake in the combined company.

TIM had previously confirmed it was carrying out a “detailed review” of the possibility of merging TIM Participacoes with GVT. It is believed the Italian company would also help distribute Vivendi’s media content in Brazil and Italy.

The TI board is meeting this week to discuss its bid.

Another potential factor is that Vodafone was reported last week to be interested in acquiring a Brazilian operator, with TIM thought to be its favoured target.