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Brazil: Regs unconcerned over hidden debts of Oi merger

By  |  July 14, 2014

Oi revealed last week that its merger target Portugal Telecom allegedly hid certain debts the company accumulated from Oi before they reached a deal, but Brazil authorities say they remain confident the deal will remain unharmed.

Oi claims Portugal Telecom deliberately hid about $1.2 billion worth of debt from the Brazilian telecom. Portugal Telecom reportedly amassed the debts through its investment in holding company Rioforte, controlled by Portugal’s largest bank. The bank is also an investor in Portugal Telecom.

When the debt was revealed, reports say, two Oi shareholder representatives stepped down from Portugal Telecom’s board.

But according to sources, while Brazil is eyeing the transaction closely following the news of the hidden debts, officials say the merger is unlikely to collapse.

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