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UPDATE 2-Brazilian regulator allows Société Mondiale to return to Oi board
January 6, 2017 / 1:38 PM / a year ago

UPDATE 2-Brazilian regulator allows Société Mondiale to return to Oi board

(Adds quote, details in paragraphs 4-9)

BRASILIA, Jan 6 (Reuters) - Brazilian telecommunications watchdog Anatel said on Friday it has authorized representatives appointed by minority shareholder Société Mondiale to return to the board of struggling wireless carrier Oi SA.

The agency said the participation of Société Mondiale’s board members is conditional on the presence of representatives of the regulator at meetings of the company, which filed for Brazil’s biggest-ever bankruptcy protection in June.

Anatel in November temporarily suspended two Oi board members appointed by Société Mondiale, which owns 7 percent of the carrier’s voting stock, on suspicions they had participated in meetings and influenced decisions affecting the carrier without the regulator’s permission.

“Oi’s situation and importance warrant the presence of Anatel at its board meetings,” Carlos Baigorri, Anatel’s competition superintendent, said. He added that the presence of an Anatel representative may last until the end of the company’s bankruptcy proceedings.

Anatel’s stance underscores mounting government pressure on shareholders to find a solution for Oi’s debt problem as the company is the only carrier providing service in more than a third of Brazilian cities.

Oi’s preferred shares rose 0.88 percent in early afternoon trading in São Paulo while the benchmark Bovespa index fell 0.83 percent.

Talks with creditors and at least one prospective bidder are underway after Oi’s bankruptcy filing to restructure 65.4 billion reais ($20.4 billion) of bank, bond and regulatory liabilities.

Société Mondiale’s Demian Fiocca and Helio Costa were confirmed by Anatel as Oi board members while Blener Mayhew and Nelson Tanure were named as substitutes, according to the decision.

Anatel also approved Luis Manoel de Macedo and and José Manoel da Silva as substitute board members appointed by Pharol SGPS, Oi’s majority shareholder with 27.5 percent of the voting stock. ($1 = 3.2005 reais) (Reporting by Leonardo Goy; Writing by Ana Mano; Editing by Jeffrey Benkoe and Meredith Mazzilli)

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