Portugal Regulator Rules Telefonica Still Controls PT Shares

Telefonica SA (TEF, TEF.MC) still controls the voting rights of the 8% stake in Portugal Telecom SGPS SA (PT, PTC.LB) that the Spanish company transferred control of last week in an equity swap with various counterparties, the Portuguese financial market regulator, the CMVM, said Monday in a note.

Telefonica has offered to buy PT's stake in Vivo Participacoes SA (VIV, VIVO4.BR), the Brazilian cellphone company that the two European telecommunications companies control. PT shareholders will vote on the offer at a meeting Wednesday.

The president of the shareholder meeting has to rule if Telefonica will be allowed to vote its share at the meeting, or if the Spanish company will be prevented from voting because of a conflict of interest.

-By Jeffrey T. Lewis, contributing to Dow Jones Newswires; +34 618 528 681 djmadrid@dowjones.com

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