Brasilia, Brazil, 29 May – Brazil’s National Bank of Social and Economic Development (BNDES) has approved a loan of 1.5 billion reais to mobile phone operator Vivo, a joint venture between Portugal Telecom and Spain’s Telefonica.
In a statement, the bank said the loan to Vivo will be used to complete a new GSM network, expand traffic and infrastructure capacity of the CDMA network and update technology to allow migration of the company’s services to 3G.
Vivo’s GSM network will replace the current CDMA system, which currency covers 2,295 municipalities. These areas will receive GSM capacity by July of this year.
The company will focus its investment in 2007 and 2008 on increasing traffic on the new GSM network and preparing for 3G operation.
Equipment supply contracts worth over 900 million reais with Ericsson and Huawei have already been signed by Vivo.
Vivo said the funding approved by the BNDES complemented investments already announced by the operator for 2007, totaling 1.73 billion reais, of which 235.4 million reais was invested in the first quarter.
With 5,896 employees, Vivo operates in 19 Brazilian states and in October 2006 underwent restructuring to bring all the group’s mobile units into one company, Vivo SA, owned by Vivo Participações SA. (macauhub)