Sawiris tells Brazil’s Oi: deadline for bankruptcy rescue is 1 June

Alan Burkitt-Gray
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TIM Brasil CEO says no merger with Oi as Orascom founder tells Oi to accept deal in a month

Naguib Sawiris, the Egyptian telecoms entrepreneur, has threatened to drop his rescue bid for bankrupt Brazilian operator Oi.

The company, which went into bankruptcy protection in June 2016, admitted in December that it was talking to Sawiris, who is working through his company, Orascom TMT. Then a deal was expected “in weeks”.

Now Oi has said that Sawiris and bondholders have given the operator – which has debts close to $20 billion – a deadline of 1 June.

Meanwhile TIM Brasil CEO Stefano De Angelis has said he is not pursuing plans to merge with Oi. He said he was working hard on restructuring TIM and added: “We do not want any distractions.” He was speaking in an interview with São Paulo newspaper Folha,

If Oi collapsed it would be serious for TIM, he warned. “As a company that was born mobile, we still depend on Oi’s leased lines.” But other operators would be affected by a blackout of Oi’s network.

In a notice to the market Oi said it “informs its shareholders and the market in general that Orascom TMT Investments voluntarily sent a letter to the company on this date [2 May] extending the validity of its suggestions for an alternative judicial reorganization plan until June 1, 2017”.

Brazil’s telecoms regulator, Anatel, is one of Oi’s largest creditors: it is owed the equivalent of $2.9 billion. Other creditors include a number of state banks, including Banco do Brasil, Caixa Econômica Federal and BNDES.

Sawiri is believed to have offered a $250 million investment in Oi, with another $1 billion to come from a share sale.

Oi said: “The company will keep its shareholders and the market informed of the development of the subject matter of this notice to the market.”