Simpson Thacher recently advised Portugal Telecom, Portugal’s leading telecommunications company, in the €1.4 billion spin-off of its controlling stake in its subsidiary PT Multimedia. The spin-off closed on November 7, 2007.
Portugal Telecom has a market capitalization of €10.5 billion after the spin-off and provides wireline and mobile voice, broadband Internet and other services in Portugal and mobile services in Brazil through its joint venture Vivo. PT Multimedia has a market capitalization of €3.0 billion, provides cable and satellite TV, broadband Internet and voice services in Portugal, and distributes and exhibits films in Portugal.
Simpson Thacher was originally hired in February 2006 to advise Portugal Telecom, which has a significant U.S. shareholder base, in connection with an unsolicited tender offer by Sonae, a Portuguese conglomerate. The tender offer was ultimately withdrawn in March 2007 when Portugal Telecom’s shareholders rejected proposed amendments to the company’s bylaws that were a condition to the tender offer. Portugal Telecom promised to spin off PT Multimedia as part of its response to the tender offer and to address the desire of Portuguese regulatory authorities to encourage further competition in the national telecommunications market.
The Simpson Thacher team involved in this transaction included John Ericson, Alan Klein, Todd Crider, Sandra Treusdell, Nakia Elliott, summer associate Tyson Taylor and paralegal Allen Gleckner (Corporate); and Jonathan Cantor and Sean Austin (Tax).