According to a Reuters report, Portugal Telecom and Brazilian telecom company Oi would be merging as one entity. The merger would result to the creation of a EUR1.8 billion or USD2.43 billion Brazilian telecom empire.

The new entity would be called CorpCo. The merger would have Oi exchange one ordinary share of its company stock to one share of Corpco. Oi would also exchange one preferred share to 0.9211 of CorpCo share. Portugal Telecom would swap one ordinary share to EUR2.2911 worth of CorpCo shares that would be issued at the capital increase price plus 0.6330 of CorpCo shares.

The merger would also have Oi increase its cash capital of BRL7 billion or EUR2.3 billion. Oi would be targeting an increase of BRL8 billion in cash capital to improve the new entity's balance sheet.

In a statement, Portugal Telecom said, "The merger is a natural fulfillment of the industrial alliance established in 2010 creating a leading telecoms operator led by Zeinal Bava as CEO." Portugal Telecom is Oi's largest shareholder. Bava, who was the former chief executive officer of Portugal Telecom,  became Grupo Oi SA head. Bava would remain in charge of the domestic unit of Portugal Telecom.