Conflicting reports: Huawei and China Mobile may buy Brazil carrier Oi

The O Globo website reported on Saturday that Huawei is joining forces with China Mobile to buy struggling Brazilian carrier Oi, in an attempt to boost their footprint in Latin America’s largest market.  The two Chinese companies anticipate a significant growth in business once Brazil starts deploying its 5G network. Oi’s 360,000 kilometers of fiber infrastructure is seen as an attractive asset.

Oi declined to comment on the matter, while Huawei and China Mobile did not immediately respond to Reuters’ requests for comment.

However, on Sunday Huawei told Reuters it was not interested in acquiring struggling Oi or any other Brazilian carrier.

“Huawei has no plan or interest in acquiring Oi or any other Brazilian carrier. In Brazil for more than 20 years, the company is working with all major Brazilian carriers supplying the best products and solutions to support digital transformation in Brazil,” the company said in an emailed statement to Reuters.

It would be very strange for Huawei to invest in a telecom carrier which is traditionally its bread and butter customer!

Brazil’s largest fixed-line carrier has been struggling to turnaround its business since it filed for bankruptcy protection in June 2016 to restructure approximately 65 billion reais of debt.  Oi is also negotiating its network with Spain’s Telefonica and Telecom ItaliaAT&T and another (unnamed) Chinese company.

Speculation of the bid comes as Brazil’s Senate approved a bill to update the country’s obsolete framework for telecommunications, paving the way for Oi to implement a plan to sell up to $2 billion in non-core assets. Earlier this week, Suno Notícias reported that China Mobile has filed a request to operate in Brazil and eventually acquire Oi. The country’s telecom regulatory agency Anatel said Sept. 17th it didn’t have any official information regarding the request.

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Addendum: Huawei launches new ‘Vision TV’ with 4K quantum dot color, which comes in 55″/65″/75″ sizes. Media paying attention to the fact that Huawei is adopting QD technology, which until now has been a key technology for Samsung’s TV (QLED) strategy. (ZDNet)

http://www.zdnet.co.kr/view/?no=20190920082939

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References:

https://www.reuters.com/article/us-oi-m-a-huawei-tech/huawei-to-join-forces-with-china-mobile-to-bid-for-brazils-oi-report-idUSKBN1W60EH

https://www.euronews.com/2019/09/22/huawei-denies-interest-in-acquiring-oi-or-any-other-brazilian-carrier

 

 

5 thoughts on “Conflicting reports: Huawei and China Mobile may buy Brazil carrier Oi

  1. The Chinese footprint in Brazil-Latin America’s biggest telecom market is almost non-existent.

    The three biggest mobile players in the country are controlled by groups based in Spain (Telefónica), Mexico (América Móvil) and Italy (TIM). The fourth major mobile player in the market is Brazil’s Oi.

    And yet the interest of China Mobile and other Chinese telcos in Brazil is not new.

    In 2017, when there was another round of rumors about Oi being acquired by a local or foreign player, state-run telcos China Mobile and China Telecom confirmed their interest in the carrier. At the time Oi admitted that it had held talks with China Telecom.

    This set off alarms at Telefónica and América Móvil, among others.

    “This China business is complex. We hear about it, read about it, but they operate in a dynamic that’s different from the Western world. I look at it with concern,” the CEO of América Móvil in Brazil, José Félix, told journalists then.

    “I don’t know what they’re going to do here. In China, business and government are a little mixed. Who are we going to compete with, run against? With the Chinese government or with a company?” he added.

    Some of the concerns are that Chinese groups could kick off a price war by offering very low prices.

    https://www.bnamericas.com/en/news/chinese-firms-rumored-to-be-interested-in-brazils-telecom-internet-markets

  2. Huawei and China Mobile never made a bid for Oi. Instead, Brazilian wireless carrier TIM Participações SA will consider acquiring the mobile unit of its struggling rival OI SA if it is put up for sale, Chief Executive Pietro Labriola said on Thursday. “Frequencies are an important asset for any carrier, not only for TIM”, Labriola told journalists at a company event in Sao Paulo, adding that for this reason he has to look into the deal. Based on spectrum concentration, TIM may be allowed to get the largest stake in Oi’s mobile division, he said.
    https://finance.yahoo.com/news/1-brazils-tim-considers-acquisition-180137229.html
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    Oi’s CEO to exit carrier on Jan 30, board still to choose replacement
    Brazilian carrier Oi SA said on Tuesday its Chief Executive Officer Eurico Teles will leave the company on Jan. 30 and that the board still has to nominate his replacement.
    https://www.reuters.com/article/oi-ceo/ois-ceo-to-exit-carrier-on-jan-30-board-still-to-choose-replacement-idUSE6N27A00M

  3. Excellent post but I was wondering if you could write a litte more on this subject? Did Huawei and China Mobile even make a bid for Oi? How will that financially challenged Brazilian carrier survive if it is not acquired.

    I’d be very grateful if you could elaborate a little bit further.
    Many thanks!

    1. Please check the comments in the box below the article for updates. It appears that Huawei and China Mobile never made a bid for Oi. It was a rumor, not a fact and I probably should not have posted it.

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