TIM expects its purchase of part of Oi SA’s mobile operations in Brazil to create up to 19 billion reais ($4 billion) of value for the enlarged company.
Brazilian telecoms firm said on Sunday that the net present value (NPV) forecast took into account commercial and infrastructure synergies. The lower end of the estimate was 16 billion reais.
According to the company, 45 percent of the synergies should be captured by 2030.
TIM agreed to buy Oi’s mobile operations in an auction in late 2020, when it made a joint bid of 16.5 billion reais with rivals Telefonica Brasil and Claro, a subsidiary of Mexico’s America Movil.
The deal closed last week after major regulatory scrutiny, with TIM’s national market share now seen reaching 27 percent, from 20 percent at the end of last year.
TIM said in a presentation the deal was set to boost net revenue and earnings before interest, taxes, depreciation and amortization (EBITDA) by 1.8 billion and 1.1 billion reais, respectively, for the remaining eight months of 2022.
“The acquisition is a game changer for TIM. The spectrum and network will reduce future Capex (capital expenditure) needs and boost cash flow generation. Capex-to-revenue ratio was expected to reach a mid-teens percentage by 2030 from about 20 percent currently,” TIM said.
Analysts at Guide Investimentos viewed the announcement as positive, saying that synergies between TIM and its assets are relevant and might be enlarged as the company increases the sale of products it already offers to its customers.
