Brazil’s prosecutor’s office recommended that antitrust regulator Cade block the sale of Oi mobile operations to local rivals TIM, Telefonica Brasil’s Vivo and Claro, a subsidiary of Mexico’s America Movil, reported Nasdaq.
The move sent shares in Oi – which is under bankruptcy protection – sharply down in early trading on Monday, while those of Telefonica’s Vivo and Telecom Italia’s TIM were also in negative territory.
Waldir Alves, who represents the prosecutor’s office at Cade, said in a Sunday report the deal should be blocked due to a “competition violation,” also mentioning “potential exclusionary practices.”
The winning trio, which had submitted an initial bid in July, plans to split Oi’s assets once they have antitrust approval. Oi, which filed for bankruptcy protection in 2016, is selling assets to repay creditors.
The companies said the base price came to 15.744 billion reais, with another 756 million reais to finance so-called “transition services,” which Oi will carry out over the next year in order to facilitate the transfer of assets.
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