SAO PAULO, Jan 4 (Reuters) - Privately-held Brazilian telecoms provider Algar Telecom will use a nearly 1 billion-real ($309 million) capital injection from a sovereign wealth fund to fund network expansion, its chief executive said in comments published on Thursday.
In an interview with newspaper Valor Economico, CEO Luiz Alexandre Garcia said the company would use the fresh capital to expand into the nation’s fast growing northeast, where competitor Oi SA has historically had a strong presence and TIM Participacoes SA has expanded in recent years.
The company will also use the capital to consolidate in the corporate market in Brazil’s wealthy south and southeast, he added.
On Jan. 2, Algar said it was selling 25 percent of the company to a unit of GIC Special Investments Pte Ltd (IPO-GISI.SI) for 648 million reais and cancelling an IPO scheduled for January. As part of that deal, GIC, a sovereign wealth fund established by the government of Singapore to manage the nation’s foreign reserves, will also subscribe to at least 352 million reais of new shares.
In the interview, Garcia said that while the IPO had been cancelled, the company planned to go public at some point in the future.
$1 = 3.24 reais Reporting by Gram Slattery; Editing by Mark Potter