Oi shares (OIBR3;OIBR4) recorded a bullish session on B3 this Thursday (27), with both asset classes posting intraday gains of more than 10%. Shares of OIBR3 rose 10.99% to R$ 1.01, and OIBR4 assets gained 10.74% at R$ 1.65.
On the company’s radar is the long-awaited progress in Selling the company’s movable assets to its competitors TIM (TIMS3), vivo (fift 3) naturally. The mobile part of the operator that is subject to judicial reorganization was sold in a judicial auction for 16.5 billion Brazilian reals, at the end of 2020.
At 10 a.m. (Brazilian time) next Friday (28), the board of directors of the National Telecommunications Agency (Anatel) will analyze the operation on Friday in an extraordinary meeting, which may represent another step towards the disposal of the asset.
The report analyzing the deal will be submitted by Rapporteur Emmanuel Campello, and then it will be submitted for a vote. The possibility of postponing the decision by requesting an opinion from another member of the board of directors of the supervisory authority.
The operation also needs approval from the Economic Defense Administrative Council (KED). Expecting municipal approval, by the way, moved the proceedings last week.
Oi shares jumped 15% on January 18 with It is possible that Kidd will analyze the process In an extraordinary session in the twenty-sixth of the last century, which did not materialize. However, the Antitrust Board is expected to analyze the deal soon.
In a brief analysis, Bank of America confirmed that it expects Kidd to approve the deal between the two companies in mid-February, while also awaiting pre-approval for the deal by Anatel at tomorrow’s hearing.
With no coverage of Oi shares, Bank of America (BofA) reiterated its recommendation to buy TIM shares with a target price of R$17 (or a potential 34% higher compared to the previous day’s close). The recommendation for América Móvil, Claro’s parent company in Brazil, whose shares are traded on the Mexican stock exchange, is also a buy. Analysts assert that both companies should be the main beneficiaries of the deal, as TIM and Claro should receive 40% and 32% of Oi’s customer base, respectively.
For Telefônica Brasil, the recommendation is neutral, with a target price of R$50, or a potential upside of 4.6%.
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Regarding Kidd, regardless of the date, analyst Ricardo Schweizer highlighted in an interview with radar information Last week (see video below) he thought the board should impose some constraints to mitigate the risks of a market focus on the operation, but he believes the chances of the buyout not being approved are slim.
Schweitzer explained that Oi should soon get the value of the asset purchase, gain the ability to exit judicial redemption and start its operations, which will focus on fixed line and broadband.
This new company, which does not have a mobile phone, is already nicknamed “Mini Oi”. “A company with little debt and an infrastructure arm as a strategic partner [a V.tal, de fibra óptica] and its B2C arm,” says the analyst.
For Schweizer, this situation may finally unlock the value of the company’s stock. “From the moment a company emerges from judicial reorganization, it becomes eligible for investment by a series of institutional investors, such as funds and returns to Radar. The challenge the company faces after paying its debts is to deliver operational improvements,” he said.
Among the challenges of Oi’s post-elimination recovery is expanding the subscriber base in broadband, a sector that requires investment and is very competitive. Schweizer remembers that regional providers have benefited over the past few years, exacerbating the controversy. “At the same time, Oi will need to acquire more contracts for V.Tal, to integrate service providers and 5G, to make these assets more profitable,” the analyst explains.
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