SAO PAULO, April 1 Banco Bradesco SA and Itaú Unibanco Holding SA are considering pulling out of a 6 billion real ($2.7 billion) share offering by Brazil's Grupo Oi SA, two sources with direct knowledge of the situation told Reuters on Tuesday.
The sources, who requested anonymity because a decision has not been made, declined to elaborate on why both lenders could be reassessing their participation in the deal. Itaú and Bradesco, both based in São Paulo, as well as another 12 banks signed a firm commitment to the transaction about two weeks ago.
The offering, which was scheduled to price on April 16 but was suspended last week by Brazil's securities industry watchdog CVM, is a key step to complete the phone carrier's merger with Portugal Telecom SGPS SA. Oi had obtained firm commitments from a group of lenders led by Grupo BTG Pactual SA , sources told Reuters late in March.
Bloomberg News reported the issue earlier on Tuesday. According to the Bloomberg report, a group of four banks including Itaú, Bradesco, Goldman Sachs Group Inc and Citigroup Inc are weighing pulling out of the deal because CVM asked that banks be required to buy any remaining shares of Oi, even if there is no demand.
Oi, Itaú and Bradesco declined to comment. Goldman Sachs and Citigroup had no immediate comment on the Bloomberg report.
Common shares of Oi tumbled 2.9 percent in early Tuesday trading. Preferred shares of the company fell 2.2 percent. Itaú rose 0.6 percent, while Bradesco was almost flat at the start of Tuesday's trading session.
Portugal Telecom and Oi have been discussing how to merge since the former bought 25 percent of Oi in 2010. The market value of both companies has fallen more than half over the past three years, a sign that investors bet that a merger would take place sooner or later.
The tie-up has been criticized by many Oi shareholders who have said the capital increase favors Oi's largest shareholders, including Portugal Telecom, at the expense of minority shareholders.
Other banks in the group included Bank of America Corp , Barclays Plc, Credit Suisse Group AG , Banco Espírito Santo SA, Banco do Brasil SA , Caixa Geral de Depositos SA, HSBC Holdings Plc , Morgan Stanley & Co, and Banco Santander Brasil SA.
($1 = 2.25 Brazilian reais) (Reporting by Guillermo Parra-Bernal; Additional reporting by Brad Haynes and Walter Brandimarte in São Paulo; Editing by Sofina Mirza-Reid)