The new V.tal: 3 business units and focus on datacenters

V.tal's new organizational and corporate structure reinforces the importance of the Brazilian company’s datacenter and submarine cable segments, which gain a new business unit to oversee operations.

After making a 5.68 billion-real (US$1bn) bid for Oi's fiber retail operation ClientCo, wholesale and neutral network player V.tal unveiled what its operations will look like when the transaction is approved as is expected by Oi's creditors. V.tal is owned by funds linked to BTG Pactual and has Oi as a partner.

The new operation will have three units. Pedro Henrique Fragoso, a former BTG partner and private equity and infrastructure investment expert, will lead a newly created datacenter business unit.

Amos Genish, who has led V.tal since its launch, will keep his role as chairman but step down as CEO. 

Felipe Campos, an executive with over 25 years of experience in the telecoms sector, takes over as CEO. Campos will also be responsible for the wholesale fiber operation.

Meanwhile, Marcio Fabbris, who led V.tal’s offer for the ClientCo acquisition, will lead these retail operations if the deal is completed.

“V.tal is now entering a new cycle that will give rise to three independent companies, with distinct management, which will further strengthen our performance in the neutral network and wholesale market, help us have a more strategic view of datacenters, and build the new fiber retail company after completion of the acquisition of Oi's ClientCo,” said Genish in a statement.

V.tal reported a 32% year-over-year revenue growth to 3.6bn reais in the first half of the year. Profit rose 209% to 610mn reais.

SEPARATION

V.tal said that ClientCo will operate under a separate structure, with independent management and governance to reinforce the company's "commitment to the neutrality of the neutral network operation."

Commenting on the deal, the CEO of a large Brazilian carrier told BNamericas on Thursday that, given the market context, V.tal acquiring ClientCo was a natural outcome. 

The CEO said on condition of anonymity that V.tal, as a partner of Oi, had no other option than to absorb the fiber retail operation and try to contain the loss of value and clients the business was seeing. On the other hand, the source said the wholesale player's entry into the retail arena does not help V.tal's image as a neutral network.

Due to possible conflicts of interest, he said his own company will be forced to reevaluate the contract it has for the use of V.tal’s network, which it leases to offer fiber-to-the-home (FTTH) to end-customers.

At the same time, the executive did not rule out an acquisition of part or all of ClientCo if V.tal decides to sell it.

"But I believe this whole ClientCo absorption process will still take several months," the source said.

V.tal has over 22mn homes available for FTTH provision, 26,000km of submarine cables connecting Brazil to Argentina, Chile, Venezuela, Colombia, Bermuda and the US, in addition to datacenters distributed between Brazil and Colombia.