Telecom Italia is reportedly considering making an offer for Nextel Brazil, as its interest in the for-sale operator increases.
Bloomberg sources stated Telecom Italia CEO Amos Genish could discuss a possible deal for the business at the Italian operator’s upcoming board meeting on 24 September: it may also hire advisers to explore a potential offer.
In August, Telecom Italia, Telefonica and America Movil, were tipped to be interested in Nextel Brazil, which is owned by NII Holdings and is the fifth-largest of seven operators in the country.
At the time, offers were expected to be submitted this month.
A move by Telecom Italia, which controls number three player TIM Brasil (which GSMA Intelligence estimates had 57 million connections at end-Q2), would give it a larger market share and a boost in spectrum in metropolitan areas, said sources.
Arguably, investment in Brazil would be justified as the country represents something of a bright spot for the company, given struggles in other markets including Italy, where competition recently increased with the entrance of France-based Iliad.
While NII Holdings owns a majority stake in Nextel Brazil, Access Industries also holds a 30 per cent stake in the company, which it acquired in May for $75 million. With that price in mind, the value of the entire company would be around $250 million.
Along with a possible tie-up in Brazil, Genish is also reportedly planning to discuss possible asset sales at the upcoming board meeting. This could include a discussion around its wholesale arm Spark and media unit Persidera, added sources.
The board meeting comes at a tumultuous time for the Italian operator. Its two largest investors Vivendi and Elliott Management have been embroiled in a row over the running of the company.Subscribe to our daily newsletter Back