Telefonica Creates Unified Structure For Brazil Assets

In another step designed to consolidate its Brazilian assets following acquisition last year of mobile-phone provider Vivo (VIV, VIVO4.BR), Spanish telecommunications giant Telefonica SA (TEF, TEF.MC) Tuesday announced a new unified structure in Brazil.

In 2010, Telefonica acquired Vivo in a complex deal with former partner Portugal Telecom (PT, PTC.LB). At the time of the acquisition, Telefonica executives promised a "gradual" melding of operations in Brazil between Vivo and the Spanish company's existing Brazilian asset, Telesp SA (TLPP4.BR).

On Tuesday, Telefonica announced that its top Brazilian executive, Antonio Carlos Valente, will become chairman of the combined companies. Another Telefonica executive, Luis Miguel Gilperez, will be chief executive officer.

The combined company will merge both fixed and mobile-phone operations as well as units aimed at the residential and business markets. The combined company will operate in Sao Paulo, Brazil's largest and wealthiest state.

The 2010 merger allowed the new company to become Brazil's No. 1 integrated telecommunications operator with an estimated Brazilian market share of about 27%.

--By Tom Murphy, Dow Jones Newswires; 55-11-3455-7090; brazil@dowjones.com

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