By Rodrigo Viga Gaier
RIO DE JANEIRO (Reuters) - The chief executive of TIM Brasil, Alberto Griselli, said on Thursday that its parent company Telecom Italia (BIT:TLIT)'s agreement to sell its physical network could provide an additional boost for its business in Brazil.
"Brazil is the group's priority; the crown jewel," he told Reuters on the outskirts of an innovation and technology event in Rio de Janeiro.
TIM Brasil is Telecom Italia's main business, generating around 35% of its earnings before interest, taxes, depreciation and amortization, a percentage that will increase, according to Griselli, after U.S. investment firm KKR obtained in late May EU approval to buy Telecom Italia's fixed-line network.
TIM invests an average of 4.5 billion reais ($837.8 million) in Brazil every year and, with the possibility of having fewer restrictions from its parent company, it could have more room to invest.
"The sale overseas makes our controller deleverage; as they deleverage, we have more flexibility in our capital structure here and thus more room for maneuver," said Griselli.
On Wednesday, Moody's (NYSE:MCO) raised Telecom Italia's credit rating to Ba3 and maintained a positive outlook following the deal's antitrust approval.
($1 = 5.3713 reais)