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Strategies & Market Trends : Telebras (TBH) & Brazil -- Ignore unavailable to you. Want to Upgrade?

To: JohnN who wrote (6108)	7/30/1998 4:37:00 PM
From: Steve Fancy	Respond to of 22640

Hmmm, somehow a trade (currently the closing trade) went through at 16:17 at 122 5/16 on TBR. Current bid 124 5/8 x 125 9/16. Sure hope another trade goes through before 5:00 to get the close up closer to 125. TBH on the other hand traded at 125 3/4 at 16:27...current bid 125 1/16x125 3/4. sf

To: JohnN who wrote (6108)	7/30/1998 4:39:00 PM
From: Steve Fancy	Respond to of 22640

Moody's affirms Telefonica S.A. (MADRID:TEF) ratings Reuters, Thursday, July 30, 1998 at 16:05 (Press release provided by Moody's Investors Service) NEW YORK, July 30 - Moody's Investors Service confirmed today Telefonica S.A.'s A2 senior unsecured and Prime-1 short term debt ratings following the announcement of the final results of the privatization of Brazil's state telecommunications system, Telebras. Two consortiums, both led by Telefonica S.A., won the bids for (i) Telesp Participacoes SA, the fixed-line telephone company in Sao Paulo and (ii) Tele Sudeste Celular, the cellular operator in Rio de Janeiro. The consortiums led by Telefonica S.A. will pay approximately $6 billion in total. The ratings confirmation reflects our expectation that these substantial investments in Brazil will not significantly impact the financial strength of Telefonica SA, given that the company recently raised capital for an amount of Pts 427 billion ($2.8 billion) to pre-fund these investments. We also expect a proportional contribution from the rest of the participants in the consortiums, as well as 60% of the funding from non-recourse debt in local currency provided by the government to the consortiums. In addition, we expect these ventures to raise additional debt to further build out the networks in these regions. However, a key consideration in the confirmation is that these ventures will be modestly leveraged and self-financing, even in the event the Brazilian economy remains weak for some time. Telefonica S.A., led the consortium which won the privatization process of Telesp Participacoes. The consortium includes Portugal Telecom, Spain's Banco Bilbao Vizcaya (BBV), Spanish power company Iberdrola, Chile's CTC, Argentina's TASA and the Brazilian media group RBS. In addition, Telefonica SA also led a consortium which won Tele Sudeste Participacoes. This consortium includes Japan's NTT and Spain's Iberdrola. In our opinion, Telefonica's existing international operations, the booming mobile business in Spain, improving network quality (now 86% digital), ongoing cost reduction programs, and significant marketing efforts to stimulate traffic, should continue to improve operating cash flow, which will enable the company to reduce its debt leverage, despite the investments in Brazil. Telefonica investment in Brazil is strategic because of the size of its market and because it fits Telefonica's Latin American footprint. In our opinion, Brazil should enjoy one of the fastest growth rates in the near term, because it has a currently low penetration rate of 10% and tremendous growth potential. With 160 million people, Brazil is considered one of the world's last major untapped telecommunications markets. Telefonica de Espana S.A. is the worlds's 11th largest telephone network operator, and the 5 th largest in Europe. The company operates over 17 million exchange lines in Spain where it is the dominant provider of voice telephony and provides mobile communications, data transmission, yellow pages directories services, paging and telephone equipment for rent or purchase. Through its subsidiary Telefonica Internacional (TISA), Telefonica has significant investments in Latin America, including CTC in Chile, TASA in Argentina, CPT Telefsnica del Peru, CANTV in Venezuela, TLD in Puerto Rico and in Brazil through CRT, Telesp and Tele Sudeste Celular. The company is headquartered in Madrid, Spain. Copyright 1998, Reuters News Service

To: JohnN who wrote (6108)	7/30/1998 4:43:00 PM
From: Steve Fancy	Read Replies (1) \| Respond to of 22640

Brazil's Telebras Hits TBR Record Volume On NYSE Dow Jones Newswires NEW YORK -- Trading in American depositary receipts representing shares in the former Brazilian telecommunications holding known as Telebras (TBR) surged higher Thursday, in their most active session ever. Telebras ADRs (TBR) closed up 5.6% to $124 9/16, after investors exchanged a total of 7.7 million ADRs. Meanwhile, HOLDRs (TBH), the synthetic ADR representing Telebras ADRs, closed up 6% to $125 5/8, with 3.4 million securities traded. Traders were exuberant in their comments. "Tremendous," a dealer said. "What a stock." Market participants attributed the rise and heavy activity to Wednesday's successful auction of the Brazilian government's controlling stakes in the 12 companies into which Telebras was spun off. "The price paid yesterday justifies the price action in the shares today," the trader said. She added that global funds had been conspicuous buyers, while locals in Brazil had sold.