Brazil: With debt woes, Oi seen as weakest link

After Oi announced that certain debts from takeover target Portugal Telecom were not disclosed until after the two wireless operators merged, authorities in Brazil now consider Oi to be the weakest player in the industry and are eying the company for a possible breakup.

According to reports, telecommunications authority Anatel considers Oi as the weakest operator and, according to Anatel superintendent of competition Carlos Baigorri, Oi could be ought out after the upcoming wireless auction.

”The company that doesn’t win in the auction, the market will very probably want to break up,” Baigorri said, though he did not elaborate on how he believes such a breakup might occur.

The industry is now focusing on Oi and how it will perform at the upcoming spectrum auction, if it even participates at all. Following the fallout from the newly revealed debts of Portugal Telecom, Oi may not have the funds to bid on new spectrum, according to reports.

Full content: Businessweek

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