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

To: md1derful who wrote (8294)	9/18/1998 2:44:00 PM
From: Steve Fancy	Read Replies (1) \| Respond to of 22640

Doc, checked TSC on my free trial, but couldn't find the story you referenced. sf

To: md1derful who wrote (8294)	9/18/1998 2:48:00 PM
From: Steve Fancy	Respond to of 22640

***!!!Brazil to start trading in Telebars units Monday Reuters, Friday, September 18, 1998 at 13:54 SAO PAULO, Sept 18 (Reuters) - Brazil's benchmark Bovespa stock index will list and begin trading on Monday the 12 holding companies that will replace Telebras (SAO:TELB4) in a 12-for-one swap. The listing will give minority shareholders in Brazil's former telephone monopoly stocks in the companies that were carved out of Telebras and privatized on July 29. But with the financial crisis in Asia and Russia encroaching on Brazil, what was once the most talked-about event on the Sao Paulo stock exchange is expected to pass virtually unnoticed. "Every time I mention Telebras and which companies are good buys, investors say 'but it's in Brazil,'" an analyst for a foreign bank said. "They just want to talk economy." A devaluation in Russia sent investors scurrying from emerging markets just two day after the Telebras privatization auction. Capital flight sent the Bovespa plunging to its lowest point in more than two and a half years and slashed Telebras' price to almost one third what it was on July 30. This week, markets have stabilized, however, giving investors some breathing room to look at some of the stocks' fundamentals which could lead to more selective buying and selling when Telebras' 12 holdings begin trading on Monday. "I think a good part of the market is just looking at the macro picture, but there are investors interested in companies' value out there," said Auro Rozenbaum, an analyst at Deutsche Morgan Grenfell. The 12 holdings aren't expected to be listed on Wall Street until the beginning of October. While the 12 companies don't have prices yet, investors and analysts are already planning their bets. In most cases, the favorites are the three fixed-line telephone companies and the two cellular operators serving Brazil's biggest cities. "In this market, we're really looking more at liquidity than anything else," said Roseli Machado, a fund manager at Banco Fator. "Telemar, Telesp and Telesp Celular are looking particularly attractive." Machado's not alone. William Laurent, telecoms analyst at Robert Flemings, said his top picks are Telesp Participacoes, the Sao Paulo state fixed-line holding, Tele Centro Sul Participacoes, the fixed-line operator serving Brazil's southern and western states, Telesp Celular Participacoes and Tele Sudeste Celular, the cellular company serving Rio de Janeiro and Espirito Santo states. Other analysts have similar recommendations. The above companies were bought by big European carriers account for significant percentages of Telebras' overall business. Telesp alone accounts for 33.5 percent of Telebras and is expected to begin trading at about 28.16 reais according to Laurent. DMG's Rozenbaum said the price could rise and sees a target price of 41.46 reais. Some of the smaller telephone companies, the fixed-line Tele Norte Leste and long-distance operator Embratel are considered less attractive by many analysts. Tele Norte Leste was bought by a Brazilian bidding group, led by construction firm Andrade Gutierrez. The fact that there is not an experienced telephone operator in the group made some investors anxious. The smaller companies and Embratel could suffer on concerns over liquidity and uncertainty on how the long-distance tariffs will be broken down. Following is a list of the 12 holdings and the Reuters identification codes for their preferred shares: Telesp Part (SAO:TLPP4) Tele Centro Sul (SAO:TCSP4) Tele Norte Leste (SAO:TNLP4) Embratel (SAO:EBTP4) Telesp Cel (SAO:TSPP4) Tele Sudeste Cel (SAO:TSEP4) Telemig Cel (SAO:TMCP4) Tele Cel Sul (SAO:TCSL4) Tele Nordeste Cel (SAO:TNEP4) Tele Leste Cel (SAO:TLCP4) Tele Centro Oeste Cel (SAO:TCOC4) Tele Norte Cel (SAO:TNCP4) shasta.darlington@reuters.com)) Copyright 1998, Reuters News Service