Well-informed sources say there?s nothing absurd in speculation about a possible merger of Telemar and Brasil Telecom. Telecom Italia is rumored to be behind the move. The Government would almost certainly block it, however.
The reason for the rumors is that Telecom Italia will soon have a real chance of rejoining the controlling shareholders of Brasil Telecom, requiring only a green light from Anatel on fulfillment of the ILEC?s universal-access and quality of service targets.
Brasil Telecom wouldn?t be allowed to enter the wireless segment if Telecom Italia had a significant share of its equity. But Telecom Italia could offer Telemar its stake in Brasil Telecom in exchange for Oi, Telemar?s wireless arm. The result would be two concomitant mergers: Oi would merge with TIM, and BrT would merge with Telemar.
Telecom Italia refuses to acknowledge any negotiations along these lines and there are no concrete signs that such a deal is in the works. It?s all speculation.
Blocked
The problem with this entire mega-merger scenario is that the Government would almost certainly block it. A senior source in the Presidential Palace warns there?s no chance a deal of the kind would be allowed to go forward. "The Government isn?t about to allow consolidation and maneuvering that would involve a serious blow to competition in the sector,? the source says.
The comment was a response to rumors that the controlling shareholders of Telemar and Brasil Telecom are advocating the creation of a ?strong national group? in telecoms.
