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Telecom Italia offers EUR 7 bln for GVT, Telefonica ups bid
2014-08-28 08:38:00| Telecompaper Headlines
(Telecompaper) Telecom Italia has made a EUR 7 billion cash-and-share offer for Vivendi's fast-growing Brazilian broadband unit GVT, prompting a bidding war with Telefonica, which almost immediately responded with a EUR 7.45 billion offer. Telecom Italia's proposal envisages a merger between GVT and the Italian operator's Brazilian unit Tim Brasil, with Vivendi taking a stake of around 15 percent in the combined company and 20 percent in Telecom Italia itself. The cash payment, meanwhile, will come from a capital increase by Tim Brasil. Overall, Telecom Italia confirmed that the bid was made up of 24 percent in cash and around 76 percent in shares and will be valid until 20 September. Shortly after Telecom Italia released the details of its bid, Telefonica made a new offer for GVT worth EUR 7.45 billion, up from its 05 August proposal of EUR 6.7 billion. Telefonica said it would pay EUR 4.66 billion in cash and offer Vivendi a 12 percent stake in the new combined group to be created from the merger of GVT and Telefonica Brasil. Telefonica, whose offer expires on 29 August unless the two parties agree to an extension, also offered Vivendi an option to buy an 8.3 percent stake in Telecom Italia.
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Category:Telecommunications