Tim Surges as Telefonica Boosts Stake in Parent: Sao Paulo Mover

Tim Participacoes SA (TIMP3), Brazil’s second-biggest mobile carrier by market share, rose to a 14-month high as speculation mounted that its parent company will sell the unit as part of a plan to reduce debt.

The company’s shares gained 5.8 percent to 10.70 reais at 12:02 p.m. in Sao Paulo after Telefonica SA (TEF) said in a statement that it agreed to pay $596 million to increase its stake in Telecom Italia SpA (TIT), which controls Tim, to 66 percent from 46 percent.

Telefonica’s expanded influence over the Italian phone company, which is looking for capital to pare more than $38 billion in net debt, fueled speculation that a sale of Tim could be part of the plan.

Tim’s press office in Rio de Janeiro declined to comment. Telecom Italia’s and Telefonica’s press offices didn’t immediately respond to e-mail messages from Bloomberg News seeking comment.

Tim is Brazil’s fastest-growing mobile phone operator with a 27 percent share as of July, behind Telefonica Brasil’s Vivo brand with 29 percent, according to data compiled by consulting group Teleco. The stock’s gain today was the best performance on the Ibovespa benchmark and pushed this year’s advance to 30 percent.

To contact the reporter on this story: Denyse Godoy in Sao Paulo at dgodoy2@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net

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