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Joshua Levinberg - Telecom Opportunities in Brazil

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The Brazilian Market – A Carnival of Opportunities

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Joshua Levinberg - Telecom Opportunities in Brazil

  1. 1. Opportunities in Brazil, June 23rd @ MIT Forum The Incredible Success of GVT (an Insider's Point of View) | |
  2. 2. The Story in a Nut Shell In 1999 winning an un-attractive license in the central south of Brazil for fix telephony in total cost of USD 100 K as part of privatization process In 2000 an arrangement of Equity of USD 350 M with USD 550 M vendors loans is negotiated In 2001 launching service in 3 cities in Brazil, company staff is about 150 employees 2002 – 2006: GVT grows under severe financial difficulties to 1800 employees, USD 300 M annual REV, 35% EBITDA, covering 60 cities 2007 – Debt restructure & IPO in valuation of about USD 1.5 Billion 2009 – Sale to Vivendi in USD 4.8 Billion
  3. 3. Main Challenges Group of Entrepreneurs without telecom experience and without a Telco operator back Collapse of the dot com bubble in the end of 2000 Depression of the Brazilian economy Anti competitive actions by BRT Hiring high level managers, combine with Ex-pats Debt burden with impossible financial covenants Aggressive population coverage obligation Severe collection issues Negative Cash flow and cash balance shortage Closed financial markets Starhome* Proprietary and Confidential
  4. 4. Success Factors Unified Shareholders group Choosing the right strategy and technology Hands on “Israeli management” style Creation of performance based company with a winning spirit The right blend between Locals and expats “Long distance running”, even in no light situation No compromise in performance, regardless the price Perfect execution methodology United management Choosing the right advisors Starhome* Proprietary and Confidential
  5. 5. Thank You Starhome* Proprietary and Confidential

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