PE firms Bain, Apax table $8.8-bn rival bid for Portugal Telecom's Portuguese unit

Private equity firms Bain Capital and Apax Partners yesterday tabled a €7.075-billion ($8.8 billion) for the Portuguese business unit of Portugal Telecom from Brazil's Oi, rivaling an offer from European telecoms group Altice.

Altice, the Luxembourg-based telecom investment vehicle founded by French cable king Patrick Drahi, had last week tabled a buyout offer valuing PT Portugal's business at €7.025 billion.

Both offers include earn-out payments up to €800 million related to future profit and cash generation targets.

To complicate the sale, Isabel dos Santos, the daughter of Angolan president last week made an €1.35 per share buyout offer amounting to €1.2 billion for Lisbon-listed holding company Portugal Telecom SGPS, which holds a 25.6-per cent stake in Oi.

If her bid is successful, Isabel, Africa's richest woman, will become a major shareholder in Oi, and will torpedo the sale of Oi's sale of PT Portugal business.

Her buyout conditions include acquiring over 50 per cent and no major changes such as a sale of strategic assets.

Dos Santos is also a major shareholder in Portuguese pay TV service provider NOS.

In October last year, Portugal Telecom and Oi agreed to merge their operations to form a new Brazil-based company with more than 100 million subscribers.

Portugal Telecom is the largest provider of fixed line phones and broadband in the country, with a 52-per cent share. It also holds 41.5 per cent of the mobile market followed by Vodafone with 41.6 per cent and NOS with 16.9 per cent.