The board of Brasil Telecom Participações (BTP), Brasil Telecom?s holding company, approved Tuesday, August 5, a proposal from the telco?s management to raise funds to finance operations in the period 2003-08 by ?taking out loans and financings and/or issuing debt, depending on the market conditions at the time of each transaction?. According to a material event notice issued the next day, the board also authorized ?the negotiation of terms and the granting of mandates to financial institutions to lead-manage debt issuance, form pools to obtain BNDES loans and coordinate SMP financing packages?.
The board of BTP also approved the extension of a fixed line of credit in the amount of 1.776 billion Brazilian Reals (now about 600 million US Dollars) as a guarantee for any loans or financings obtained by BrT ?and/or companies in which BTP invests directly or indirectly, for execution of the Business Plan … The guarantees shall bear interest in accordance with market practice, i.e. equivalent to 0.75% per annum?. Tenors shall be up to ten years so as to ?match maturities of the obligations assumed with those of the respective guarantees?.
At the same meeting the board of BTP also approved a buyback of up to 10% of voting and nonvoting shares outstanding in the market. The repurchased stock will be held in treasury, canceled or resold. The board of BrT, the operating company, approved a buyback of up to 10% of its nonvoting shares.