Brazil's TIM CEO Vows to Continue Competing Against Vivo

SAO PAULO -(Dow Jones)- TIM Participacoes, Brazil's No. 2 cellphone operator, will continue to compete vociferously against market leader Vivo Participacoes, despite the deal that brings a major Vivo shareholder into the controlling group of TIM, TIM Chief Executive Mario Cesar Pereira de Araujo said Friday.

"I want to see Vivo clients in our (subscriber) base, and I am sure that they have the same aim," he said in an interview with Dow Jones Newswires.

On Thursday, the Telco consortium, which includes key Vivo shareholder Telefonica, sealed a EUR4.1 billion deal to take a controlling stake in Telecom Italia, which owns TIM.

The deal was on hold for about six months as it awaited regulatory approval in Brazil.

On Tuesday, Brazilian telecom regulator Anatel approved the deal on the condition that Vivo and TIM maintain separate operations, infrastructure and strategy.

Araujo said TIM would certainly honor that decision. TIM and Vivo have been locked in competition for dominance of the growing Brazilian cellular market in recent years, and Araujo said that war would continue.
Vivo is jointly controlled by Telefonica and Portugal Telecom.

Araujo said TIM would compete against Vivo in the government's upcoming auction for third-generation mobile licenses.

Vivo has a 27.8% share of cellphone subscribers in Brazil, while TIM comes in a close second with 25.9%.

-By Alastair Stewart, Dow Jones Newswires; 5511 3145-1479; alastair.stewart@dowjones.com

(END) Dow Jones Newswires­

Posted to the site on 26th October 2007