Telefonica prepares for court battle over control of Vivo.

Within this strategy, the first step is to go to the Court of Arbitration at The Hague to try to end the union of the two operators in the Netherlands company, which owns 60% of Vivo, the sources said.

Telefonica prepares for court battle over control of Vivo.

The Spanish company will go to the Court of Arbitration at The Hague to try to end the union of Portuguese and Brazilian operators.

Two days after the expiry of the latest offer from Telefonica for the participation of Portugal Telecom (PT) in Brazil's Vivo, the operator is prepared to fight for control of Vivo in court, with Arbitration at The Hague as the first probable scenario.

To begin, Telefónica has hired the law firm De Brauw Blackstone Westbroek Dutchman, who advised the carrier and Portugal Telecom in the creation of joint venture Brasilcel-Vivo-controlling, to try to dissolve it, said sources familiar with the operation.

The Spanish multinational reported in the early hours of Friday to Saturday the notice given to Portugal Telecom to buy its 30% share of Vivo, with an offer on the table of 7,150 million euros, it was held back by the Portuguese Government.

After three months of negotiations, Telefonica agreed not to extend the talks until next July 28 to give it time to resolve ‘certain issues’.

However, some analysts such as Citigroup, said today that the purpose of Telefónica to the extinction of the period was to put "pressure" on Portugal Telecom. "The offer is not dead," said the Citigroup report, it expects the transaction to be resolved before the 28th of July, while other analysts point to the courts.

"Another option would be to encourage arbitration, an issue that seems likely but that would last between one and three years," says Bankinter, which explains that the pact signed by the two companies with the creation of Brasilcel is binding for 25 years, but provides some options.



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