The acquisition of Brasil Telecom by rival Oi can go ahead, after the Brazilian president changed the country's telecoms rules to clear the way for the deal. President Luiz Inacio Lula da Silva has signed a decree allowing a single firm to hold licences in more than one region, scrapping the biggest regulatory hurdle to the USD5.3bn takeover.
The move follows a long investigation by the national telecoms authority, Anatel. The agency is now expected to give final approval to the takeover, which was agreed in April. However, officials warn the process could take more than a month. Oi and Brasil Telecom have set a December 21deadline for completing the deal. Under the agreement, Oi will have to pay a fine of BRL500,000 if the deal does not close in time. But Oi execs expect the deal to close in January or February and plan to pass the fine on to Brasil Telecom.
The deal will see the creation of the largest Brazil-owned telco. The merged entity will compete against foreign-owned operators Telefonica and Telmex in Brazil and in South America.
StrategyEye's related companies: Telefonica, Telmex, Anatel, Telemar PCS (Oi), Brasil Telecom
