Brazil's Telemar gets board approval to merge its 3 units

Telemar Participacoes SA, Brazil's largest telco, has gotten the go-ahead to merge its three units into one common company from their boards of directors.

And the shareholders liked the plan as each unit reported that their respective stocks rose yesterday.

Brasil Telecom SA rose 4.5 percent to BRL 11.57 (USD 7.25), while Tele Norte Leste Participacoes SA rose 3.8 percent to BRL 20 (USD 12.5) and Telemar Norte Leste SA increased 2.6 percent to BRL 44.50 (USD 27.86).

"It shows the company is one step closer to the merger," said Rosangela Ribeiro, an analyst at SLW Corretora brokerage, in a Bloomberg article. "Having only one company trading in the exchange will make things easier to everyone, from investors to the company itself."

Although getting each board's approval is a positive first step, shareholders still need to approve the deal.

For more:
- SFGate has this article

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