Embratel is trying to keep control over Net
The Brazilian operator Embratel, owned by Telmex, announced the launching of a voluntary public offer for the acquisition of the 100% of Net preferential shares, the main Brazilian cable operator currently controlled by Globo (51%) and Embratel (49%). If the proposal is approved, over USD 2,600 millions will be paid. In order to gain total control, Telmex subsidiary will have to wait for the approval of Bill 116 (former Bill 29), which is currently in the Senate and eliminates restrictions on foreign capital.
According to a press release issued by Embratel, the price to be paid per share, in cash and local currency, amounts to USD 13, which accounts for a 23.1% prize over the price recorded in the last 30 days. The offer is aimed at "enabling an increase in Embratel's shares in Net capital share in virtue of Embratel's and its shareholder' trust upon the Pay-TV and broadband consumption increase in the country, as well as the management and business model developed by Net", according to the document signed by Isaac Berensztejn, Relationship with Investors Director.
The offer is targeted to all Net's preferential shareholders, except from the part that belongs to Embratel (Embrapar). As an advance of its commercial intentions, a few days ago, Net announced the inclusion of Roberto Catalao, an executive from Embratel, in the operator's financial area. In 2004, Embratel stepped in Net with the acquisition of Globo's shares. At present, Net is the main operator in Brazil and Latin America, with 3,9 million Pay-TV clients.