BTG Pactual Takes Full Control of V.tal After Judge Overrides Creditor Veto

The most contentious asset sale in Brazil’s largest-ever telecom bankruptcy just got resolved — by a judge, not by the creditors who hold the debt.

Judge Simone Gastesi Chevrand of Rio de Janeiro’s 7th Business Court approved BTG Pactual’s R$4.5 billion ($849 million) bid for Oi’s remaining 27.2% stake in V.tal on Wednesday night, ending weeks of legal brinkmanship between the investment bank, Oi’s management, and an international creditor group that had vetoed the transaction. BTG Pactual funds now control 100% of Brazil’s largest fiber-optic network operator.

The R$7.8 Billion Gap

The core dispute was price. Oi’s recovery plan, approved in April 2024, set a minimum price of R$12.3 billion ($2.3 billion) for the V.tal stake. BTG’s bid of R$4.5 billion ($849 million) — the only offer submitted — covered just 37% of that floor. The deal also includes a R$500 million ($94 million) earn-out payment contingent on a future V.tal IPO.

Creditors under Oi’s Restructuring Option I — including major international funds such as PIMCO, Ashmore, and SC Lowy, as well as Portuguese bondholders — rejected the offer at a March 30 hearing. They argued that accepting a bid 63% below the minimum price would constitute destruction of value and undermine the integrity of the recovery process. BTG, which already controlled the remaining 72.8% of V.tal, refused to improve its offer.

Why the Judge Overruled

The court determined that the R$12.3 billion ($2.3 billion) minimum price was outdated and no longer reflected market conditions. Oi’s own judicial management team had supported the transaction, citing an independent valuation by G5 Partners that found the BTG offer “reasonable from a strictly financial standpoint.” With no competing bids and V.tal already majority-controlled by BTG, the practical alternatives were limited.

Judge Chevrand imposed several conditions. BTG cannot pursue an IPO of V.tal for 24 months. If it violates this restriction, BTG must pay Oi 90% of the gross profit, minus 10% for operational commitments. The ruling also imposes a penalty equal to 50% of the bid value — R$2.25 billion ($425 million) — if BTG attempts to withdraw the offer. Workers’ creditors from Serede, an Oi subsidiary, had supported the BTG bid, preferring the certainty of cash payment over prolonged legal uncertainty.

What V.tal Controls

V.tal is not a marginal asset. The company operates more than 502,000 kilometers of terrestrial fiber and 26,000 kilometers of submarine cables, making it Brazil’s largest neutral-network fiber infrastructure operator. Its network reaches over 22 million homes passed with fiber (HPs) and serves 3.8 million connected households. V.tal also owns Tecto, a data center business operating in Brazil and Colombia with edge solutions and hyperscaler-grade projects.

The company was created in 2021 when Oi separated its fiber infrastructure from its retail operations as part of its first recovery plan. BTG funds acquired majority control for R$12.9 billion ($2.4 billion) in 2022. In 2024, V.tal also purchased Oi’s retail fiber customer base (ClientCo) for R$5.68 billion ($1.07 billion), consolidating both wholesale infrastructure and 4 million end-user customers under one roof.

What It Means for the Market

For BTG Pactual, full ownership eliminates the governance complexity of sharing V.tal with a bankrupt minority partner and positions the bank for a potential IPO after the 24-month lockup expires in 2028. At 14x EBITDA, the acquisition multiple is below what comparable fiber infrastructure assets have commanded globally — a factor BTG likely weighed against the litigation risk of competing for an asset it already controlled.

For Oi’s creditors, the ruling is a blow. The R$4.5 billion ($849 million) proceeds will enter the recovery estate, but the gap between what creditors expected to recover from V.tal and what they are receiving is substantial. Civil society groups have separately challenged the broader Oi restructuring, arguing that the transfer of fiber infrastructure originally built under public concession represents a loss of public assets. An Anatel-contracted consultancy valued the fiber infrastructure alone at R$32-36 billion ($6-6.8 billion).

For Brazil’s broader telecom sector, the consolidation of V.tal under a single financial owner creates the country’s dominant fiber infrastructure platform — a neutral network that smaller ISPs depend on for wholesale access. Whether BTG maintains V.tal’s neutrality or steers it toward more vertically integrated operations will shape competitive dynamics in Brazilian broadband for the rest of the decade. With Brazil’s tax reform reshaping the cost structure for telecom infrastructure investment and inflation trends influencing the Selic rate path, the financial terms of V.tal’s future — whether IPO, strategic sale, or continued private ownership — will be closely watched by investors across Latin America’s largest economy.

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