Power holding company Companhia Brasiliana de Energia has signed an agreement with Brazilian mobile operator TIM (NYSE: TSU) to sell telecommunications branch AES Atimus for 1.6bn reais (US$1.02bn).
The acquisition is expected to be completed by December.
Companhia Brasiliana de Energia - controlled by US power group AES (NYSE: AES) and BNDESPar, the investment arm of Brazilian national development bank BNDES - decided to sell Atimus to focus their business in power generation and distribution.
The sale attracted great interest in the market due to the extended reach of Atimus' fiber optic network, covering São Paulo and Rio de Janeiro. The company's network has a total extension of more than 5,500km connecting 21 cities, representing 27% of Brazil's GDP.
The acquisition will help TIM win half a million corporate customers and 8mn residential clients to provide high speed broadband.
"Building a fiber optic network from scratch today, in the two most highly populated metropolitan areas in the country, is virtually impossible," TIM Brasil president Luca Luciani said.
In more than 10 years of operation, Atimus' revenues increased by 16 times, from 13mn reais in 2000 to 211mn reais in 2010, reaching an operating margin of 63%.
TIM is fully controlled by European operator Telecom Italia (NYSE: TI).