Brazilian telecom group Oi SA (OIBR3.SA) is reconsidering the sale of its African assets as relations improve with an estranged partner, Chief Executive Bayard Gontijo said on Monday.

Gontijo said its minority stake in Angolan mobile operator Unitel is still booked as an asset available for sale, but Oi is working to patch up relations with partner Isabel dos Santos.

"We're working with two scenarios. One is selling the asset," Gontijo said during an interview in New York while on a U.S. roadshow with investors. "The other one is fixing those old disputes ... in a structure where we have the shareholders' agreement respected by both sides."

Better relations could give access to dividends that dos Santos has blocked for years, due to a dispute that began with Oi shareholder Portugal Telecom SGPS (PTC.LS). Oi got control of the Angolan asset in a merger with Portugal Telecom.

As Oi's debt soared and losses mounted last year, selling the Unitel stake looked like one of the best ways to stem a worsening crisis for the company by raising cash quickly, but Gontijo said the picture was changing with talks in Angola and an operational turnaround in Brazil.

"We are changing the center of gravity from Lisbon to Brasilia," Gontijo said, adding that relations with Isabel dos Santos, the daughter of Angolan President Jose Eduardo dos Santos, were "improving and evolving."

Dos Santos is chief executive of Unitel and owns 25 percent of the company, with other Angolan investors, including state-oil company Sonangol, holding another 50 percent.

Gontijo pointed out that Brazil's state development bank BNDES, a major shareholder and creditor of Oi, has strong relationships in Angola.

Oi's preferred shares, which are down 73 percent from a year ago, rose 1.4 percent in Sao Paulo trading.

NO DEADLINES

In December, Gontijo said he planned to sell the Unitel stake by the end of 2015. But as his turnaround strategy has boosted Oi's operating margins and cash flow, Gontijo said he is taking a more patient approach to big deals, including a potential tie-up with a rival in Brazil's telecom market.

Last year, Oi hired investment bank BTG Pactual to negotiate a bid to acquire Brazilian mobile carrier TIM Participações (TIMP3.SA) and split it three ways with the local units of Telefonica (TEF.MC) (VIVT4.SA) and America Movil (AMXL.MX).

"I cannot say if the consolidation is going to be in 2015, 2016 or 2017," said Gontijo. "Let's not put a deadline on it, because the stronger we get in terms of the turnaround, the stronger we are going to be to sit down with our peers for a consolidation."

The chief executive of TIM's controlling shareholder Telecom Italia SpA (TLIT.MI) said in February that a deal in Brazil was not a priority, and last week a senior Brazilian government official confirmed that talk of consolidation has gone quiet. Rafael Mora, who is a board member of both PT and Oi, also said last week that the consolidation has run into delays, though he still expected a deal in 2016.

A first-quarter loss of 447 million reais ($147 million) due to weak sales and debt-servicing costs showed Oi is still not out of the woods. But cost cutting lowered operating expenses by 5 percent from a year ago and earnings before interest, tax, depreciation and amortization (EBITDA), as well as excluding capital spending and one-time items, rose 78 percent.

The sale of non-essential real estate assets, valued around 1 billion reais on Oi's books, may also be delayed until next year, Gontijo said, since it depends on negotiating with regulators. Oi could raise less cash by selling usage rights to its properties this year.

Gontijo said telecom regulator Anatel should understand Oi's need to raise funds so that it can finance a national broadband plan that Brazil's President Dilma Rousseff is advocating.

Oi is also pressing Anatel to reconsider service requirements that force the company to invest in money-losing public phones instead of priorities such as broadband. Gontijo said Oi spends 300 million reais per year on phone booths that generate just 17 million reais in revenue.