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Huawei And China Mobile Contemplating Joint Bidding For Brazil’s Oi: Reports


09/23/2019


Huawei And China Mobile Contemplating Joint Bidding For Brazil’s Oi: Reports
According to a report published in the O Globo Newspaper, the possibilities for a joint bid for the Brazilian phone company Oi SA is being mulled by Chinese etch giant Huawei Technologies Co. and China Mobile Ltd.
 
Huawie is the largest telecommunications equipment making company in the world and the second largest smartphone maker of the world and has been caught in the cross fire in the trade war between the United State s and China. Analysts viewed this move by Huawie as its attempt to venture into the Brazilian market so that it is bale to expand its market for 5G technology – the next generation mobile connectivity technology, of which Huawei is one of the global leaders, the report said without attributing the information and claims to any source. The report also added that the move by the Chinese companies also coincides with the efforts of the Brazilian government to seek investments and funding for Oi SA since it is in high debt.
 
No comments were available on the issue from Oi as well as from Huawei and China Mobile.
 
In a recent move, the Senate of Brazil passed a bill seeking to significantly and completely update the obsolete framework for telecommunication system and network of the country which makes it an ideal time for Huawei and China Mobile to move into the Brazilian market. The Senate bill has also helped Oi to put in force its plans of selling up to $2 billion worth of its non-core assets.
 
According to a report Suno Notícias published earlier this week, a request to operate in Brazil had been filed already by China Mobile and would ultimately acquire Oi. It didn’t have any official information regarding the request, the country’s telecom regulatory agency Anatel however said September 17.
 
Speculation of negotiations between the Brazilian carrier and other companies has also been sparked by the approval of the bill buy the Senate. Reports in the Brazilian media that they’re in talks with Oi had been denied in the past week by both Telecom Italia SpA and Telefonica Brasil SA.
 
Selling all of its assets in its African unit Unitel SA is sought to be sold by the Rio de Janeiro-based telecom operator so that it can focus on the last mile of its fiber-optic network which is the largest in the Brazil. The aim of the company is to generate revenues again even as the company gets into the ultimate phase of the two year judicial recovery plans for the company.
 
Last month, a loss of 1.56 billion reais ($376 million) was posted by Oi and informed that the loss was because of expending of 2 billion reais of cash in the second quarter. This report was a damper for the investors who are yet to recover from the $19 billion debt restructuring that the company was subjected to in December 2017. The loss reported by the company had forced the telecom company’s largest shareholder to demand resignation of the chief executive officer of the company.
 
(Source:www.bloomberg.com)