CADE clears acquisition of capital share of Oi S.A.

On 28 August, the Office of the Superintendent General of CADE cleared the acquisition of Oi S.A by PIMCO, SC Lowy, Ashmore, among others. The transaction occurred as a result of the conversion of debts into shares, giving creditors share capital in Oi S.A.

The acquisition is part of the second case of an administration process of Grupo Oi, in the 7th Business Court of the Capital of the State of Rio de Janeiro, since March 2023.

The company submitted a Judicial Reorganization Plan which was cleared by the General Meeting of Creditors and ratified by the Reorganization Court in Brazil. The plan established measures aiming to overcome the current economic and financial situation of the firm and to allow its recovery.

Each of the companies,  PIMCO, SC Lowy, and Ashmore are to obtain 5% of capital share of Oi S.A. The acquisition of equity interest by PIMCO/Allianz Group is of mandatory notification to CADE, in accordance with the Brazilian competition law.

The Office of the Superintendent General of CADE analysed a vertical integration between the wholesale communication market by Intelsat, and the multimedia communication service market (SCM), the public switched telephony network (PSTN), the conditional access service (SeAC), and Oi's satellite capacity service.

Due to Intelsat and Oi market shares below 30%, CADE concluded there was no possibility of foreclosure in the affected markets, and cleared the acquisition.

The decision of the Office of the Superintendent General of CADE is regarded final and the deal fully approved if the authority's Tribunal does not request the case for adjudication or a third party does not appeal to the ruling within 15 days of its announcement.