Telemar offers units 12 pct premium to restructure
Reuters, 06/22/2001 18:20
SAO PAULO, June 22 (Reuters) - Telemar (SAO:TNLP4)(NYSE:TNE), Brazil's biggest fixed-line telephone operator, Friday offered 15 of its units a 12 percent premium to be incorporated into its Telerj (SAO:TERJ4) subsidiary.
The transaction, which must be approved by companies' boards and Brazil's telecommunications regulator Anatel, aims to boost efficiency, streamline the units' operations and improve access to financing.
Telemar, a holding company of 16 telephone firms which span from Rio de Janeiro in the south-east to the far north, said in a statement the premium was based on valuations of its various units by Goldman Sachs.
The shares in Rio de Janeiro-based Telerj sky-rocketed when Telemar announced plan to bring all its units under the company's roof at the beginning of the month. Trader bet the operation would add attractive liquidity to the stock.
Telemar said if the number of shareholders preferring to cash in stocks instead of accept the share swap was too big it would cancel the incorporation of some if not all the units.
Telemar stock, the heaviest-weighted on Brazil's benchmark Bovespa (INDEX:$BVSP.X) stock index, lost 1.5 percent to 36.66 reais Friday on the back of Wall Street losses.
Roberto Terziani, Telemar's investor relations officer, has said Telerj would have net worth slightly less than Telemar's 10.4 billion reais ($4.5 billion) if the swap went to plan.
Rival fixed-line company Brasil Telecom Participacoes (SAO:TCSP4) carried out a similar restructuring early last year, which launched Brasil Telecom SA (SAO:TEPR4) as the company's traded operating unit.
($1 = 2.32 reais) saopaulo.newsroom@reuters.com))
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