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Telefónica seeks €8bn bank loan
06 July 2010
Telefónica is seeking an €8bn loan to support its offer for Portugal Telecom’s stake in Brazilian operator Vivo
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Telefónica
Vivo
Portugal Telecom
Spain
Brasilcel
Spain’s Telefónica is looking for €8 billion of loan financing from around 20 banks to back its offer for Portugal Telecom’s stake in Brazilian mobile company Vivo, and refinance existing debt.
The telecom company is seeking €5 billion to finance the €7.15 billion bid for Vivo and €3 billion to refinance debt that matures in the short-term. Banks are being invited to provide €250 million or €500 million in commitments.
The maturity of the €5 billion loan is likely to be five years.
PT and Telefonica have been in dispute over Vivo, which the two companies control through Brasilcel, a joint venture that owns 60% of Vivo, after Telefónica launched a bid for PT’s stake.
Majority of shareholders backed Telefónica’s sweetened bid of €7.15 billion, but the sale was obstructed when the Portuguese government vetoed the purchase last week. GTB