Brazilian regulator approves Telefonica takeover of Vivo
Brazilian telecoms regulator Anatel said Friday it had given conditional approval for Telefonica's 9.7-billion-dollar takeover of Brazil's biggest cellphone operator Vivo.
The transaction was dependent on Telefonica ensuring that Vivo extended its 3G rollout in Brazil, that several towns without coverage had cell network access, and that universities have access to Vivo's fiber optic network, it said in a statement.
If the conditions were not met, Anatel said it could impose fines or even reverse the takeover.
Telefonica said in July it had agreed to buy all Portugal Telecom's shares in Vivo to take control of the Brazilian operator.
Telefonica and Portugal Telecom held 60 percent of Vivo through Brasilcel, a joint investment entity.
Portugal Telecom agreed to the transaction after it was sweetened twice, and said it would use up to 4.8 billion dollars of the money raised from the sale to buy into a "strategic partnership" with Brazil's fourth-ranked cellphone operator, Oi.
Both Telefonica and Portugal Telecom see fast-growing Brazil as a key market as they face stagnant growth in their saturated domestic markets.
Anatel's provisional approval means the Vivo deal now goes to Brazil's Administrative Council on Economic Defense, a body that guarantees market competition.
© 2010 AFP