Purchase of Oi Móvel by Claro, TIM and Vivo will be made official next week – Tecnoblog

A Hi Mobile was sold to Of course, TIM e Vivo at auction held in December 2020, but only now that the deal will be made official. The trio notified Oi and scheduled the closing of the transaction and signing for April 20, 2022. The buyers will have up to 18 months to complete the migration.

Oi Móvel was sold to Claro, TIM and Vivo
Oi Móvel was sold to Claro, TIM and Vivo (Image: Guilherme Reis / Tecnoblog)

As it is a very large company with a high degree of importance in the sector, the process of selling Oi Móvel was long and delicate. Bodies such as Anatel and the Administrative Council for Economic Defense (Cade) had to give the approval so that Claro, TIM and Vivo could take over the fourth operator. The call closing of the business is important for actually making the transaction official.

Oi should receive around R$ 16.5 billion for the mobile telephony arm and capacity contracts. The largest share belongs to TIM, which will pay R$ 7.3 billion and will receive 40% of the customer base. The second largest share belongs to Vivo, equivalent to R$5.5 billion, followed by Claro, which will pay R$3.7 billion.

Completion of the deal does not mean that all customers will be transferred immediately to the purchasing operator. Anatel established that buyers have a maximum period of 18 months for the complete migration.

So far, TIM was the only company that detailed the transition process. The Italian operator expects that the entire base from Oi Móvel will be able to connect to the new network within three months of the official deal.

Anatel’s February data show that Oi accounted for 16.4% of the entire Brazilian cellular telephony market, with around 42.1 million lines. Most customers are on prepaid, while postpaid (which has higher prices and generates more revenue) represents 40% of accesses.

What operators say

The operators disclosed a material fact to the market, with the exception of Claro, which is not publicly traded in Brazil.

A Vivo informed that the purchase of Oi Móvel “brings benefits to the Company’s shareholders through the acceleration of growth and generation of efficiencies due to operational synergies, as well as to customers, as a result of the improvement in the user experience and quality of the service provided”.

A TIM described that the deal will allow the transaction to define “a new infrastructure balance between the three main competitors in the industry, while maintaining a high degree of industry rivalry”. Compared to Claro and Vivo, the Italian operator has a smaller amount of spectrum.

Me and Hey informed that, due to the conclusion of the deal, the operator will start a public offer to repurchase US$ 880 million of debt securities maturing in 2026. The operator had guaranteed to repurchase the securities after completion of the sale of the mobile unit.

Vivo and TIM also informed that they will hold a conference call to present the effects of the transaction to the market. The dates have not yet been announced, but the events will be available on each company’s investor relations website.

Tecnocast 229 – Everything you need to know about the sale of Oi Móvel

The auction may have taken place in December 2020, but the sale of the Hi Mobile was only authorized now, in February 2022. With this, the company’s mobile customers will be divided among the remaining trio of national operators: Claro, TIM and Vivo. Brazil loses another player in this market segment.

In this episode we tell that story right from the beginning. Why did Oi Móvel need to be sold? How is the competition in the Brazilian mobile telephony sector with only three major operators? And, for Oi’s customers, how will things be going forward? To understand this whole situation, play and come with us!

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