Despite a number of denials, Telemar announced Wednesday that Oi, its wireless arm, has been merged with the holding and operating company (TMAR).
In a press release and notice to the equity market the company said the transaction was designed to optimize operations and support through synergies and more rational use of available resources.
Telemar will pay 4.761 billion Brazilian Reals (now about 1.59bn US Dollars), computed on the basis of Oi?s debts including 563m BRL owed to the holding company. The price per subscriber will be 934 USD, more than double the price paid by Telesp Celular for TCO.
Most equity analysts expected the announcement. Some told TELETIME News a few hours beforehand that the absorption would increase Telemar?s indebtedness and reduce cashflow but not as much as feared by many investors, who since early in 2003 have been selling TMAR to buy stock in the holding company (TNLP). As a result TNLP is up 38% in the year to date, while TMAR has posted gains of only 2%.
This trend began reversing even before the announcement. TMAR had gained 5.5% at one point on Wednesday but closed up 4.98% on 44.25 BRL. TNLP closed down almost 1%.