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

To: Steve Fancy who wrote (6116)	7/30/1998 5:29:00 PM
From: EPS	Respond to of 22640

Market Status at 02h37 pm ET After the tremendous success of Telebr s historical auction yesterday,see related story, the calm seen this morning in Wall Street was really the last ingredient lacking to make investors' confidence grow stronger. The extraordinary premium (63.7%) paid over Telebr s' minimum price, in addition to the total amount raised (R$22bn) are making Brazilian share prices jump. All expectations, at least for today, are that the market should continue trading up and strong. The Ibovespa index midday rally sent stocks even higher to 10,939 points or 3.37%. Trading volume is at R$896.421m with some 27.021bn shares having changed hands. The Rio de Janeiro Stock Exchange Index (IBV-RJ) is also higher by 4.15% at 39,283 points. Among the blue chips, Telebr s PN up 6.23% at R$145.00. Eletrobr s also higher by 3.36% at R$36.90. Usiminas down 1.52% at R$6.50. CSN up 3.45% at R$27.00. The dollar market, Agˆncia Estado informed, should continue benefiting from the astonishing success of the Telebr s privatization auction and, consequently, the perspective of a flood of foreign currency associated with the auction -- expected to reach between US$5 and R$6bn, as the BFW informe yesterday. As a result, dollar futures projections should find some room for a further fall during the day. The decision of the Monetary Policy Committee (Copom) yesterday evening of reducing the annual Central Bank basic rate (TBC) to 19.75% from 21%, see related story, is also doing wonders to elevate sentiment. In the face of this positive scenario, the US commercial dollar Ptax remains trading at R$1.1621/R$1.1620.

To: Steve Fancy who wrote (6116)	7/30/1998 5:30:00 PM
From: EPS	Respond to of 22640

Jul/30/98 at 02h42 pm ET Telebr s sale to spark profound changes in market Sao Paulo, 30 - Sao Paulo, 30 - The privatization of the Telebr s System as well as its splitting are seen as generating profound changes in the Brazilian equity markets. The participation of telecommunications companies' shares in the country's major stock market indices began increasing right after former-president Fernando Collor de Mello's election in 1990, to reach 50% at the end of 1992. Since then, Telebr s' liquidity has been attaining levels considered high even by international standards, with its ADRs standing amidst those most traded in Wall Street. However, the company's privatization auction is expected to put an end to such high liquidity, since local stock markets should concentrate on the trading of a group of selected shares, after the loss of its blue chip -- responsible for at least half of the deals in the Sao Paulo Stock Exchange (Bovespa). Natural candidates to fill in the void left by Telebr s' shares, analysts claim, are those of telecoms deemed most attractive by traders, as well as those of Petrobras, which are benefited by current fundamentals, such as the sector's opening to new partnerships, the breaking of trading barriers, in addition to the prospect -- though not confirmed by the government -- of its privatization in the near future. Analysts cite Telesp (both fixed and cellular) and Embratel as topping the list of the heirs of Telebr s' liquidity. "Investors tend to participate in only one of the three telephony categories -- namely fixed, mobile and long-distance -- into which the Telebr s System will be separated," Lloyds Asset Management's analyst, Fl vio Conde, pondered. Traders interested in the fundamentals of the telecommunications sector usually seek the best option within this specific market, whereas those pursuing high liquidity offered by Telebr s are likely to opt for the best options on offer, in or outside that sector. "In terms of liquidity, Petrobr s is the safest option available," Conde said. Another issue arising amidst market analysts is whether the liquidity offered by the total of these new shares will be equivalent to Telebr s' current turnover. According to Ricardo Almeida, ING Bank's stock manager, the new companies born from Telebr s splitting already have the potential of reaching the same level or even outpacing their mother-company. However, he believes this should only be attained in the long term. He added that investor migration should be gradual, at the same time it should benefit Bovespa futures index, which is expected to receive a large part of Telebr s option deals. (By Liliane Hage and Josu‚ Leonel. Edited by Marcos Viesi)

To: Steve Fancy who wrote (6116)	7/30/1998 5:31:00 PM
From: EPS	Respond to of 22640

ebt Market Latin American Bradys/Globals mostly higher in NY Sao Paulo, 30 - Latin American Bradys and Globals are trading mostly higher in New York on the back of stronger US equities and spill over optimist from Brazil's successful sale of its telecom holding, Telebr s, see related story. The largest gains are being posted by Bras 27 and ARG 17, higher by 0.89% and 0.78%, respectively. The only exception at the moment is Mexico's UMS 26, lower by 0.51%. (By Paulo Monteiro)

To: Steve Fancy who wrote (6116)	7/30/1998 5:31:00 PM
From: EPS	Respond to of 22640

Jul/30/98 at 03h30 pm ET Telebr s sale excels PND's previous achievements Sao Paulo, 30 - Telebr s sale not only represents the world's second largest privatization, see related story, but is also responsible for the largest amount raised during the lifetime of National Privatization Program, (PND), created seven years ago during Fernando Collor's administration. Before the privatization of the Telebr s System, funds raised with the PND had totaled R$17.9bn. However, the sale of the telecommunications giant alone brought R$22.058bn to government coffers. The result surprised the government as it expected a premium of only 17%, in comparison to the astonishing 63.74% premium paid by the private sector. Market analysts point out that the bloc formed by Telef¢nica de Espana and Portugal Telecom were the two main winners of the privatization, see related story as they took companies such as Telesp Participa‡oes (fixed line), considered the system's "precious jewel", and also Telesp Celular. (By Paulo Monteiro)

To: Steve Fancy who wrote (6116)	7/30/1998 5:32:00 PM
From: EPS	Respond to of 22640

no not this.. Jul/30/98 at 08h46 am ET Lawsuits against Telebr s privatization are still pending Sao Paulo, 30 - The government faced and won several juridical battles to make the Telebr s privatization possible, but the controversy surrounding the injunctions lasted until after the sale was concluded. The problem was that the 1st Region Federal Regional Court, in Bras¡lia, suspended two injunctions after the auction had begun. According to the opposition, the auctioneer had already kicked off the sale when the lawsuits were rejected. Communications minister, Luiz Carlos Mendon‡a de Barros, denied the allegations. Suits still pending in Justice will be judged, regardless of the fact that the privatization has already been carried out. According to a Federal Supreme Court (STF) minister, the possibility of having the privatization annulled is just about nil. (O Estado de S. Paulo/ Jornal da Tarde/ Folha de S.Paulo/ Jornal do Brasil/ O Globo/ Correio Braziliense/ Zero Hora)

To: Steve Fancy who wrote (6116)	7/30/1998 5:34:00 PM
From: EPS	Read Replies (1) \| Respond to of 22640

Probably already in the archive but here it goes again.. Telebr s: See Brazil's telecommunications new owners Sao Paulo, 30 - The privatization of the Telebr s System "could not have been better", according to the government. The company's R$22bn sale represented the world's 2nd largest privatization, obtaining a premium of 63.74% over its minimum price, see related story. Foreign capital was responsible for the acquisition of some 32% of Brazilian fixed telephony and for 79% of the country's cellular telephony. See below the new owners of the Brazilian telecommunications system. Telebr s System Company Price(R$m)/Premium(%) New Owner Fixed line Telesp..................5,783/226.18%..Telef¢nica Espana Tele Centro Sul.........2,070/6.15%....Banco Opportunity Tele Norte Leste........3,43/1%........Andrade Gutierrez Embratel................2,65/47.22%....MCIaran and Santa Catarina Cellular Telesp Celular..........3,588/226.18%..Portugal Telecom Tele Sudeste Celular....1,36/138.6%....Telef¢nica de Espana Telemig Celular.........756/228.7%.....Telesystem International Tele Celular Sul........700/240%.......Globo, Bradesco and Telecom Italia Tele Nordeste Celular...660/193.33%....Globo, Bradesco and Telecom Italia Tele Leste Celular......428.82/242.4%..Iberdrola Tele Centro Oeste.......440/91.3%......Splice do Brasil Tele Norte Celular......188/108.8%.....Telesystem International (By Paulo Monteiro)

To: Steve Fancy who wrote (6116)	7/30/1998 7:10:00 PM
From: TOPSID877	Respond to of 22640

Liberdade por fim! Liberdade por fim! Meu Deus poderoso! Nos somos livres por fim! Or at least we're getting there. And its about time, too.

To: Steve Fancy who wrote (6116)	7/30/1998 8:31:00 PM
From: Jerry A. Laska	Respond to of 22640

Brazil says will use all Telebras cash for debt BRASILIA, July 30 (Reuters) - Brazil will use all the $19 billion raised by the privatization of telephone company Telebras to pay off publicly held debt, a spokesman for President Fernando Henrique Cardoso said Thursday. ''All the money from the sale of Telebras will be used to reduce debt,'' spokesman Sergio Amaral said. Shortly after Wednesday's auction of Telebras' 12 operating subsidiaries, Cardoso told reporters the money raised exceeded government expectations by about $5 billion and some of it might be used to beef up public spending. But Amaral said Thursday the government planned to use the money only to reduce Brazil's debt stockpile, which currently stands at around $280 billion. Any savings resulting from lower interest rates would be spent helping drought victims in Brazil's poor northeast, he said. Amaral said the government expected to receive 8.8 billion reais ($7.59 billion) of the Telebras receipts this year. Under rules for the privatization, buyers of the 12 Telebras subsidiaries on offer must payment 40 percent of minimum asking prices, plus any premium, as a first installment. biz.yahoo.com

To: Steve Fancy who wrote (6116)	7/30/1998 8:33:00 PM
From: Jerry A. Laska	Respond to of 22640

FOCUS-Brazil telecom shares jump after big auction (Updates with market close, details) By Adrian Dickson RIO DE JANEIRO, July 30 (Reuters) - Brazilian financial markets toasted the massive Telebras privatization on Thursday, the day after some of the biggest names in global communications paid $19 billion for Latin America's largest phone network. Many telecom shares on the Sao Paulo stock exchange made strong gains on Thursday, as investors scrambled to buy into the Telebras units seen as most likely to profit under private ownership. Shares of Telesp Celular(TSPC6.SA), covering wealthy Sao Paulo state and bought by Portugal Telecom(PTCO.IN) for nearly $3 billion, soared 9.66 percent. Rio de Janeiro's Telerj Celular (TRJC6.SA), bagged by Spain's Telefonica (TEF.MC), closed up 7.14 percent. There were losers, too. Shares of fixed-line telephone company Telemig (TMGR6.SA) plummeted 12.95 percent amid concerns over the absence of any phone company from the group that won the operation at Wednesday's auction. On Thursday, Sao Paulo's key Bovespa stock index closed up 3.76 percent, with Telebras preferred stock rising 5.86 percent. Volume was the highest in more than three months at $1.06 billion, and Telebras accounted for 60 percent of the activity, up from the usual 50 percent. ''More than mere relief, euphoria is the word. The world's second-biggest privatization exceeds best expectations,'' wrote Banco Icatu analyst Marcelo Mollica Jourdan in a report. A handful of Europe's largest telephone companies grabbed the lion's share the Telebras network at a marathon four-hour auction Wednesday. Between them, Spain's Telefonica, Portugal Telecom, Telecom Italia (TIT.MI) sucked up seven of the 12 Telebras spin-offs and generated almost 75 percent of the privatization proceeds. Analysts said the scarcity of large U.S. companies was a sign that the turbulence in their own telecommunications market prevented them from focusing on opportunities in Brazil. Others said the U.S. operators -- such as BellSouth Corp. (BLS - news), which had been widely expected to bid -- may have decided to wait for Brazil to auction concessions to compete with the privatized operations in fixed-line and long-distance services later this year. For most of the big investors, Thursday was a time to sit back at assess their multibillion-dollar purchases. ''The work is only just beginning. The next few weeks are going to be extremely hectic,'' said Jose Maria Manuel Masso, a spokesman for Telefonica. He said Telefonica's senior management was readying plans to call special shareholder assemblies in the three operations the Spanish company had acquired and choosing new directors to represent it on their boards. Another immediate concern for all the buyers was to ensure they could come up with a required 40 percent of the value of their purchase in cash before an Aug. 4 deadline. In Brasilia, officials were still celebrating how smoothly the four-hour Telebras auction went and the boost that the sale will give to Brazil's hard-pressed fiscal accounts. The $19 billion result was $7.4 billion more than the asking price of $11.7 billion, allow authorities to slice off 7.0 percent of Brazil's total federal debt in a single blow, as one analyst put it. ''Never has there been a privatization like this in the history of capitalism,'' President Fernando Henrique Cardoso told reporters in a moment of rare effervescence. Cardoso has good reasons to be pleased. Newspapers billed the Telebras auction an extraordinary success, describing it as the turning point for Brazil's long underfunded telecommunications industry. ''A huge victory for the government,'' read Thursday's lead editorial in daily O Estado de Sao Paulo. Analysts said the success of the Telebras privatization would help boost Cardoso's candidacy as he prepares to run for a second four-year term in the October national elections. biz.yahoo.com

To: Steve Fancy who wrote (6116)	7/30/1998 8:36:00 PM
From: Jerry A. Laska	Respond to of 22640

Brazil shares end higher amid optimism on telecoms SAO PAULO, July 30 (Reuters) - Brazilian stocks closed up 3.76 percent as investors went after shares of Telebras (TELB4.SA) and cellular phone companies amid optimism that new management will bring needed investments and higher profits. ''Everybody's revising their evaluations in a more positive light,'' said Roque Sut Ribeiro, an equity fund manager at Marka Nikko Asset Management in Sao Paulo. Sao Paulo's key Bovespa (^BVSP - news) index of the 58 most active stocks closed up at 10,939. Telebras preferred rose 5.86 percent to 144.5 reais, one day after the 12 units that were carved out of the telephone monopoly were sold for $19 billion. Investors were returning to Telebras stock in the last few days of its trading life as an avenue to buy into the 12 holding companies that will soon replace the former telephone monopoly on Brazilian and U.S. exchanges. Telebras' common shares closed up 5.5 percent to 105.50 reais on Thursday. Total trading volume surged to 1.24 billion reais ($1.06 billion), the highest in more than three months. Trading in Telebras shares accounted for more than 60 percent of total operations, compared with the average of about 50 percent. ''Trading is heavily concentrated in Telebras and other telecoms,'' Ribeiro said. Telebras shareholders will be able to take possession of the new shares as early as next week, Brazil's securities and exchange commission CVM said. They also have the option of trading their shares in for Telebras receipts (TELB40.SA) which will represent all 12 holdings. Cellular phone companies such as Telerj Celular (TRJC6.SA) and Telesp Celular (TSPC6.SA) outperformed the market after international heavyweights paid hefty premiums Wednesday to gain control of fast-growing markets for wireless services. Telerj Celular closed up 7.14 percent at 75 reais, while Telesp Celular surged to close up 9.66 percent at 125 reais. Fixed-line telephone companies Telemig (TMGR6.SA) and Telerj (TERJ4.SA) bucked the market's upward trend, leading declining stocks. The companies are controlled by Tele-Norte Leste, one of the 12 Telebras units sold to a Brazilian investment group on Wednesday for more than $3 billion. ''The consortium that won doesn't have a telephone operator and that's caused concern,'' a trader at a local brokerage said. ''There are also questions about how the group will meet investment requirements.'' Telemig plummeted to close 12.95 percent down at 74.60 reais and Telerj ended off 1.6 percent at 80 reais. Among blue chip stocks, state-controlled oil company Petrobras (PETR4.SA) closed up 1.16 percent at 262.01 reais, while Brazil's energy holding company Eletrobras (ELET6.SA) surged to close up 5.04 percent at 37 reais. Cia. Vale do Rio Doce ended up 0.77 percent at 24.99 reais. biz.yahoo.com

To: Steve Fancy who wrote (6116)	7/30/1998 8:50:00 PM
From: Jerry A. Laska	Read Replies (2) \| Respond to of 22640

Oil sector next for private investment but too early to speak of privatization Rio De Janeiro - With the privatization of Telebr s finished, the oil sector will be the next item on the agenda for infrastructure reformularization by the government. " In the coming year, it will be the petroleum sector that will attract the public attention ", the said David Zylbersztajn, president of the National Agency of Petroleum. Guaranteeing that the first sales of interests in oil fields will be carried out in April of 1999, Zylbersztajn commented, however, that still it is premature to think about a privatization, such as with the telephony system. " We are in a process of incorporation of private capitals, and not of privatization ", it commented. ........ ANP: ‚ cedo para falar em privatiza‡ao Rio de Janeiro - Encerrada a privatiza‡ao da Telebr s, o setor de petr¢leo ser o pr¢ximo item da pauta de reformula‡ao de infra-estrutura do governo. "No ano que vem, ser o setor petrol¡fero que atrair a aten‡ao p£blica", disse o presidente da Agˆncia Nacional do Petr¢leo, David Zylbersztajn. Garantindo que as primeiras licita‡oes para concessao de campos de petr¢leo serao realizadas at‚ abril de 1999, Zylbersztajn comentou, no entanto, que ainda ‚ prematuro pensar numa privatiza‡ao, como a do sistema de telefonia. "Estamos num processo de incorpora‡ao de capitais privados, e nao de privatiza‡ao", comentou. agestado.com