Brazil's TIM sees $4 bln boost from Oi mobile deal (updated)

Telefonica Brasil, SA

25/04/2022 11:42

(Updates with details, TIM forecasts)
    SAO PAULO, April 25 (Reuters) - TIM SA  TIMS3.SA  expects
its purchase of part of Oi SA's  OIBR4.SA  mobile operations in
Brazil to create up to 19 billion reais ($4 billion) of value
for the enlarged company, the Brazilian telecoms firm said late
Sunday.
    TIM, which is controlled by Italy's Telecom Italia SpA
 TLIT.MI , said the net present value (NPV) forecast took into
account commercial and infrastructure synergies. The lower end
of the estimate was 16 billion reais.
    According to the company, 45% of the synergies should be
captured by 2030.
    TIM agreed to buy Oi's mobile operations in an auction in
late 2020, when it made a joint bid of 16.5 billion reais with
rivals Telefonica Brasil SA  VIVT4.SA  and Claro, a subsidiary
of Mexico's America Movil SAB de CV  AMXL.MX .  urn:newsml:reuters.com:*:nL1N2UK23K
    The deal closed last week after major regulatory scrutiny,
with TIM's national market share now seen reaching 27%, from 20%
at the end of last year.
    TIM said in a presentation the deal was set to boost net
revenues and earnings before interest, taxes, depreciation and
amortization (EBITDA) by 1.8 billion and 1.1 billion reais,
respectively, for the remaining eight months of 2022.
    "The acquisition is a game changer for TIM... The acquired
spectrum and network will reduce future capex (capital
expenditure) needs and boost cash flow generation," the company
added, noting its capex-to-revenue ratio was expected to reach a
mid-teens percentage by 2030 from about 20% currently.
    ($1 = 4.7937 reais)

 (Reporting by Gabriel Araujo  Edting by Louise Heavens and Mark
Potter)
 ((Gabriel.Araujo2@thomsonreuters.com; +55 11 5644 7745;))