Privatization tips june 1998
Brazil
- Rio de Janeiro - Brazil's National Monetary Council announced in June that it has approved the takeover by Credit Suisse Group's CS First Boston of investment bank, Banco Garantia. Industry sources estimate that the sale was closed for the amount of $675 million, the latest in a series of moves by major international banks into Brazil's financial sector. Local Brazilian press also reports that CS First Boston payed a commission of $34.6 million as a fee to Brazil’s Central Bank for the takeover of Garantia.
- Brazil's National Development Bank (BNDES) said on Monday it would start the massive sale of federal telecoms holding Telebras with the Sao Paulo state fixed-line group Telesp Participacoes. A BNDES spokeswoman said the 12 companies -- three fixed-line holdings, eight cellular operators and one long-distance carrier -- spun off from Telebras would go on the block in the following order in three separate auctions on July 29:
Group A - Fixed-line/long-distance
1. Telesp Participacoes (3.52 billion)
2. Tele Centro Sul (1.95 billion)
3. Tele Norte Leste Participacoes (3.4 billion)
4. Embratel (1.8 billion)
Group B - Cellular
1. Telesp Celular (1.1 billion)
2. Tele Sudeste Celular (570 million)
3. Telemig Celular (230 million)
4. Tele Sul Celular (230 million)
Group C - Cellular
1. Tele Nordeste Celular (225 million)
2. Tele Leste Celular (125 million)
3. Tele Centro Oeste Celular (230 million)
4. Tele Norte Celular (90 million)
The minimum price for the entire Telebras system is $11.7 billion, but Brazil hopes to rake in $15 billion in what is expected to be Latin America's biggest privatization.
- Workers at Brazil's will be offered a 2.18-percent stake in the soon-to-be-privatized federal telecommunications company starting on July 29, a government official said. The offer of a total 7.3 billion preferred shares, at a price of 69.24 reais per 1,000 shares, will be part of Telebras' scheduled July 29 privatization, Latin America's largest-ever asset sale. In preparation for the privatization, Telebras has been split into 12 holding companies. Workers who subscribe for the shares will actually receive 12,000 shares, or 1,000 from each holding, when the stock is distributed on October 30, the BNDES official said.
- Mexico’s deputy transportation minister, Aaron Dychter, announced the privatization of nine Mexican airports in the next five years. Dychter told reporters that at least 67 companies have expressed interest in participating in the privatization offer estimated at $200 million. The airports, located along the Mexican Gulf and the Yucatan Peninsula, serve 9.3 million passengers a day, according to the Mexican Airport Authority. Mexico is privatizing its 35 airports in 4 regional packages for an estimated value of $4 billion, according to private estimates.
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