BRASILIA, March 18 (Reuters) - The Brazilian government is likely to attract bidders to two remaining concessions to operate fixed-line telephone networks when it attempts to sell them for a second time next month, analysts said.
Prospective buyers must put down financial guarantees by Thursday and submit technical proposals on how they will develop the networks on Friday. The winner will be announced on April 23.
''The outlook is much better than it was six months ago,'' Marcelo Mollica, a telecoms analyst at Banco Icatu said.
Brazil will be selling concessions to operate a fixed-line telephone company to compete with Telesp Participacoes in Sao Paulo and another to compete with Tele Centro Sul in the country's southern and western states.
The two licenses failed to attract any technical proposals when the government tried to sell them in January. Two concessions to operate a fixed-line company to compete with Tele Norte Leste and another to operate a long-distance operator were sold last month.
''I think interest should be bigger now, especially since the concession prices are even cheaper in dollar terms,'' Mollica said.
The first two licenses were sold amid the government's failed attempt at a controlled devaluation in mid-January. Brazil has since allowed its currency, the real, to float on the foreign exchange markets, and it has lost about 35 percent against the dollar.
Anatel, Brazil's telecoms watchdog agency, and analysts said the government ought to have better luck this time around.
''Today there is no black cloud hanging on the horizon; the devaluation has already happened,'' Mollica said. ''And the recession won't matter for these companies because they won't even start operating until the economy is in full recovery.''
Brazil's privatizations will be closely watched as a gauge of investor confidence in the country's long-term economic outlook. Though winning bidders will not put down much money initially to buy the concession, investments could be hefty.
Qualcomm (Nasdaq:QCOM - news) do Brasil, Bell Canada International (Toronto:BI.TO - news), and Brazil's Vicunha -- the industrial group that bought a concession in January to operate a fixed-line service that will compete with Tele Norte Leste -- could compete for the southern region.
The guarantees must be submitted to the Rio de Janeiro stock exchange on Thursday. Officials are not expected to provide any information on potential bidders until after the technical proposals are handed in Friday. |
