Telefónica to consider selling 2% of PT, Brazilian firm Oi shows interest

The telecommunications company Telefónica is paying close attention to Portugal Telecom's (PT) IPO. Telefónica currently owns 2% of the Portuguese operator, which is hardly a management stake. But still, the Spanish telecom's shares are non-strategic, meaning they could be put up for sale sooner than later. That said, sources close to the deal indicate that Telefónica's only desire is to get the best price possible in the deal, no matter the buyer, without showing any favoritism or rushing the deal so much that it falters.

Market estimations indicate that Telefónica, headed by César Alierta, could bring in around 200 million euros and that there will be plenty of potential buyers. The first potential candidate is the Brazilian firm Oi, which currently owns 25.6% of PT (either directly or indirectly) and wants to develop a solid shareholder relationship with the Portuguese firm. Currently, Oi owns 7% of PT, which grants it the right to have two representatives on the Oi's board. Sources from Oi revealed in April of 2011 that the company wanted to balance the relationship somewhat and increase its stake in PT to 10%, but then Oi managers decided not to hold conversations with PT about this goal.

But things have changed a lot in the past year and a half, and rumors of Telefónica selling its shares in PT have started to circulate during the past several days in light of Oi?s stated interest in increasing its position in PT.

Under these circumstances, ideal factors are coming together to ensure the companies to come to an agreement, assuming that the companies can come to an agreement about price: one company wants to buy (Oi) and another is ready to sell (Telefónica). It is known that the Spanish firm would be very receptive to selling its shares so that it can comfortably meet its debt obligations and pay out a dividend to shareholders.