TIM Participacoes SA (TSU)

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Tele Celular Sul Participacoes SA was one of the 12 holding companies in which the assets of the state-owned Telebras were divided for their privatization. The remaining 11 holding companies were comprised of one long distance company (Embratel), seven wireless (A-band) companies, and three wireline companies. Before its restructuration, Telebras system was comprised of 27 state wireline companies, 26 state wireless (A-band) companies, and one long distance company (Embratel). In 1998, Tele Celular Sul Participacoes SA was created as a holding company to own the equity participation of Telebras in three cellular mobile operators in the South of Brazil: Telepar Celular SA (67.3 percent), Telesc Celular SA (83 percent), and CTMR Celular SA (78.6 percent). Through A-band (800s Mhz), Telepar Celular SA provided cellular mobile telephone services to Parana state, Telesc Celular SA to Santa Catarina state, and Companhia Telefonica Melhoramento e Resistencia Celular (CTMR Celular) to the municipalities of Pelotas, Morro Redondo, Capao do Leao and Turucu in the state of Rio Grande do Sul. Like the other eleven companies created from Telebras, Tele Celular Sul Participacoes SA was fully privatized through an international competitive bidding in July 1998 when the Brazilian federal government sold its equity participation for US$ 603 million (R$700 million) to a consortium led by Bitel Participacoes and UGB Participacoes. The project was sold with a premium of 204.3 percent over the minimum set by Brazilian government. The winning consortium paid 40% of its offering on August 3, 1998. The remaining 60 percent would be paid in two equal annual installments which would be adjusted according to the CPI plus a 12 percent annual interest. The concession area of Tele Celular Sul Participacoes comprised of nearly all of area 5 (Telepar Celular and Telesc Celular) and part of area 6 (CTMR Celular). The Brazilian cellular market was divided in 10 areas in 1996 in order to assign licenses for cellular phone services. In each area, A-band was assigned to the state owned companies that provided local fixed phone services in the area, while B-band was awarded to a private consortium through a competitive bidding. Tele Celular Sul Participacoes SA competed with Global Telecom in area 5 and with Telet in its part of area 6 since 1998. In December 1998, UGB sold its shares in Tele Celular Sul to Bitel Participacoes, a subsidiary of Telecom Italia Mobile (TIM). In November 2002, through a internal reestructuring, Telesc Celular and CTMR Celular became wholly-owned subsidiaries of Telepar Celular. Before the transaction they were subsidiaries of Tele Celular Sul Participacoes, the controller of Telepar Celular. In December 2002, the company converted its concession contract into an authorization without termination date. In July 2003, Telesc Celular and CTMR Celular were incorporated by Telepar Celular. The later, now with all the assets of the former, had its name changed to Tim Sul. Tim Sul is controlled by Tele Celular Sul Participacoes, which has 81.3% of the total capital (90.4% of the voting capital) of Tim Sul. In September 2003, the controller of Tele Celular Sul Participacoes, Bitel, incorporated Tim Brasil SA and had its name changed to Tim Brasil Servicoes e Participacoes (Tim Brasil). Tim Brasil has 22.2% of the total capital (52.5% of the voting capital) of Tele Celular Sul Participacoes. In 2004 TIM consolidated its operating companies and merged TSU and Tele Nordeste Celular (TND) and created TIM Participacoes SA (TSU). In March 2006, TIM Celular SA (project 2959) was fully acquired by TIM Participacoes SA and operated as its subsidiary for 2006. In 2008, TIM won the competitive bidding organized by the regulatory agency Anatel for eight licenses to provide 3G services (its bids were on average 88% above the minimum price set by Anatel). The company was expected to implement the necessary investment to provide mobile services to at least 60% of the areas it bid for in an 8-year period. The company's bid represented a total payment of US$ 723.9 million (BRL 1324.7 million) to Anatel. In October 2009, TIM Nordeste S.A. was fully incorporated by TIM Celular. Also in 2009, Intelig Telecomunicacoes had 100% of its shares acquired by TIM Participações. In December 2010, TIM won the competitive bidding organized by the regulatory agency Anatel for 8 out of 46 licenses to provide 3G services. The bid represented a total payment of US$ 50.1 million (BRL 81.8 million) to Anatel, and the contract was signed in April 2011. In December 2011, TIM won an additional bidding for 9 out of 15 licences to provide 3G services. The bid represented a total payment of US$ 67 million (BRL 109.3 million) to Anatel, and the contract was signed in 2012. In June 2012, TIM won the competitive bidding organized by the regulatory agency Anatel for one out of four licenses to provide 4G cellular services. TIM's offer was of US$ 427.6 million (BRL 340 million), and the contract was signed in 2012. In December 2012, the state-owned bank BNDES approved a US$ 1016 million (BRL 1983 million) loan to TIM Celular and US$ 92.9 million (BRL 181.4 million) to Intelig. In September 2014, TIM won the competitive bidding organized by the regulatory agency Anatel for one out of eight licenses to provide 4G cellular services. TIM's offer was of US$ 828.3 million (BRL 1947 million) for the concession rights, and the contract was signed in December 2014. Merger 2006: 31 de janeiro de 2006 - O Conselho de Administração da TIM Participações S.A. (“TIM Part”) e TIM Celular S.A. (“TIM Cel”) aprovaram a transação de reestruturação entre TIM Celular e TIM Participações, contemplando a incorporação de ações da TIM Cel na TIM Part. Após a conclusão da transação, a TIM Celular se tornará subsidiária integral da TIM Participações. 16 de março de 2006 - foi aprovada, em Assembléia Geral Extraordinária, a incorporação da totalidade das ações de emissão da TIM Cel ao patrimônio da TIM Participações, nos termos do Protocolo e Justificação de Incorporação de Ações celebrado entre as Companhias em 31 de janeiro de 2006, convertendo-se a TIM Cel em subsidiária integral da TIM Participações. For accounting purposes all 2006 data assumed that the merger took place on January 1, 2006. It invested US$ 114.4 million (R$212.9 million) in its operations throughout 1999. During 2000, the company invested US$ 102 million (R$ 204 million) and increasing its customer base to 1,416,484 up from 1,000,000 in 1999. 2001 saw investments of $71 million. In the following year, 2002, the company invested $ 23.6 million (R$ 69 million).