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

To: Steve Fancy who wrote (6398)	8/6/1998 11:41:00 PM
From: Alan Palange	Respond to of 22640

BRASILIA, Aug 6 (Reuters) - Brazil's telecommunications regulator has altered a key detail of the rules governing future competition in the sector in a move that eases a restriction on the new owners of the recently privatized Telebras system. Under Brazil's competition plan, each of the three regional, fixed-line spin-offs of Telebras, plus long-distance carrier Embratel, will compete against "mirror" companies from 1999. While the mirrors will have to set up their own infrastructure from scratch, they will enjoy complete freedom to use Wireless Local Loop (WLL) technology, a radio-based system that does not require the costly installation of fixed lines. The National Telecommunications Agency (ANATEL) ruled in May the new owners of the Telebras fixed-line companies would also be allowed to use WLL to compete with the mirrors, but only in areas where the population is less than 30,000. At a meeting Wednesday, however, ANATEL raised that limit to 50,000 after receiving several "suggestions" from companies which bought fixed-line companies at last week's Telebras auction. "We did not give in any way," Antonio Valente, a member of ANATEL's directive council, told reporters Thursday. He added that some of the investors who bought into Telebras wanted the limit to be raised to include areas with as many as 200,000 inhabitants, significantly reducing the advantage of the mirror companies. Valente said the change would not reduce the attractiveness of the mirror concessions to leading telephone operators. The new owners of the Telebras fixed-line companies will be free to use WLL in areas not covered by the mirror companies. The Brazilian government hopes international telecommunications companies beaten at last week's privatization and those which stayed away altogether will seek to buy the mirror concessions when they are auctioned later this year. Earlier Thursday, AT&T Corp. <T.N> said it would study the possibility of bidding for the mirror concessions. REUTERS Rtr 23:07 08-06-98

To: Steve Fancy who wrote (6398)	8/7/1998 12:26:00 AM
From: Steve Fancy	Read Replies (1) \| Respond to of 22640

INTERVIEW - Itochu (TOKYO:8001) cautiously taps Brazil Reuters, Thursday, August 06, 1998 at 22:00 By Noriko Yamaguchi SAO PAULO, Aug 6 (Reuters) - Itochu Corp., one of Japan's five biggest trading houses, said Thursday it was slowly returning to Brazil after nearly two decades of absence in Latin America's largest economy. Itochu hoped to make up for the void by taking up a minority stake in a Brazilian cellular phone company Tele Sudeste Celular, which was sold off at Telebras' (SAO:TELB4) privatization auction last week, Itochu Brasil SA president Yasuyoshi Ota told Reuters. Though vying for a minority share, Itochu, together with NTT Mobile Communications, a cellular unit of Japan's giant NTT Corp. (TOKYO:9432), were the only Asian contenders bidding at Latin America's biggest selloff in history. "We're kicking off with Telebras, and we already have a string of other investment plans coming up," Ota said, without elaborating. Ota said Itochu barely invested at all in Brazil during the 1980s after suffering loan defaults and amassing heavy debts in Latin America. It first set foot in Brazil in 1957. But he added the South American country was now one of the trading house's hottest area. "The whole company is now turning to this region (Brazil) after the Asian crisis," he said. Itochu and NTT Mobile joined a consortium led by Spain's Telefnica (MADRID:TEF) to snap up Tele Sudeste Celular for 1.36 billion reais ($1.17 billion) on Wednesday. The Japanese baffled local industry watchers when they reduced their participation a day after the purchase to a negligible amount. Itochu said it would announce in 10 days what its final stake in the telecom would be. The two had initially said that they would take up 8.5 percent and 5.5 percent stakes respectively, but then reported to the Rio de Janeiro stock exchange that they would keep a minimum 1,000 shares each. An Itochu official had told Reuters after the auction the final price tag on Tele Sudeste was way over what the company's Japanese headquarters had in mind. But Ota said on Thursday the move did not imply the Japanese were clashing with Telefnica. "We have no qualms about the price Telefnica offered to pay," he said. Itochu was positive Tokyo would agree to renegotiate for a bigger stake with Telefnica in the future, he said. The company's Brazil investment last year, which was mainly in auto imports and telephone infrastructure, totaled about $10 million. "This year could close with five or six times that amount with Telebras' buy," he said. Looking into the future, Itochu is also keen on Brazil's energy and petroleum sector, Ota said. The company last month announced it will develop oil in Rio de Janeiro's offshore Campos Basin in a joint project with Brazilian gas and oil giant Petrobras (SAO:PETR4) and another Japanese trading house Mitsubishi Corp (TOKYO:8058). "We're confident Brazil's our good bet over the next three to five years although at first hand it doesn't seem like we're investing a whole lot," Ota said. noriko.yamaguchi@reuters.com)) Copyright 1998, Reuters News Service

To: Steve Fancy who wrote (6398)	8/7/1998 12:33:00 AM
From: Steve Fancy	Respond to of 22640

Brazil sees large tax revenue from oil concessions Reuters, Thursday, August 06, 1998 at 22:00 BRASILIA, Aug 6 (Reuters) - Brazil expects to reap 60 billion reais (US$51.5 billion) in taxes over the next 15 to 20 years from the 397 oil concession contracts which were signed Thursday, the National Petroleum Agency (ANP) said. ANP Director-General David Zylberztajn told reporters the contracts represented "a gigantic step" which would put Brazil firmly on the map in terms of the international oil market. "According to the first projections, 60 billion reais will be collected with these contracts for municipalities, states and the union (Brazil) in the next 15 to 20 years," he said. Each concession contract is subject to four separate tax criteria -- a signature bonus, special participation fee, royalties and an area rental fee. The Mines and Energy Ministry, ANP and state oil giant Petrobras (SAO:PETR4) signed the exploration, development and production contracts Thursday to herald the opening of Brazil's oil sector to foreign companies. Last month, Brazil ended 45 years of carefully protected monopoly over its oil when the ANP moved to free up some of Petrobras' fields for outside exploitation. As a result, foreign oil firms will be able to produce oil in Brazil either through concession contracts for the newly opened areas or as operators in joint ventures with Petrobras. Copyright 1998, Reuters News Service