Tess (merged with BCP SA (Claro))

active

Tess was awarded a 15-year concession to provide cellular phone services through the B band (800s MHz) in area 2 in March 1998. The area 2 comprised the state of Sao Paulo, except the state capital city and surrounding areas. The Brazilian telecommunications market was divided in 10 areas in 1996 in order to assign licenses for cellular phone services. In each area, the B band was assigned to a private consortium through a competitive bidding and the A band was assigned to the state owned companies that provide local fixed phone services in the concession area. Telesp, the state-owned competitor of Tess in most of the area 2, was privatized in July 1998. Tess won its license through a competitive bidding when it offered US$ 1,173.8 million (R$1,326.9 million) for the license in April 1997. The company started its commercial operations in December 1998. The concession contract was signed in March 1998 when the consortium paid 40% of their offering. The 60% remaining has to be paid in three equal installments during the first three years of the concession contract. By 2000, Tess was a consortium led by Telia Overseas AB (51%) and integrated by Algar (33.98%) and Eriline (16.35%). By the end of 2001, Tess was controlled by Tel Investmentos (Telia Group) (64.91%), Eriline (15.19%), and Telecom Americas (19.9%). During 2002, America Movil became the controller of Telecom Americas (96%), by acquiring the stakes of SBC International and Bell Canada International. In 2003, Tel Investimentos sold its stake (64.91%) in Tess to Telecom Americas (America Movil). Since August 2003, Tess and all mobile operations of Telecom Americas in Brazil are operating under the brand name "Claro". America Movil has grouped it's Brazilian operating companies (ATL, Tess, BCP, BSE, Claro Digital, and Americel) under this group. From 2004 all information is recorded under BCP (Claro). By end 1998, the initial investment in network was US$ 603 million (R$700 million). Most of the network development was financed by Ericsson, the equipment supplier. None