UPDATE 1-Portugal firm on Vivo sale veto under current bid

* Position unchanged unless Telefonica alters bid – minister

* Not involved in talks, awaits developments

* PT board to reconvene Friday to discuss 7.15 bln euro bid

* Bid expires later on Friday

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LISBON, July 16 (BestGrowthStock) – The Portuguese government will
maintain its veto on the sale of Portugal Telecom’s (PTC.LS: )
stake in Brazil’s Vivo (VIVO4.SA: ) to Telefonica (TEF.MC: ) unless
the Spanish company alters its 7.15 billion euro ($9.3 billion)
bid.

Cabinet Minister Pedro Silva Pereira told a news briefing on
Friday that “the government had already manifested its
opposition to the offer and if it is not altered, naturally the
government’s position cannot change”.

Portugal Telecom’s board is to reconvene later on Friday to
discuss whether to endorse Telefonica’s bid, which expires the
same day.

The goverment stunned investors last month by using its
golden share to block a shareholder vote overwhelmingly in
favour of selling PT’s stake in Vivo, Brazil’s top cellphone
company, to joint venture partner Telefonica.

The European Court of Justice later said the use of the
golden share breached EU rules on the free movement of capital,
opening the prospect of a lengthy legal battle unless PT and
Telefonica can agree terms.

The government said it respects the court’s decision but
will continue to safeguard national interests.

Both companies have since said they want to resolve the
matter through negotiation.

“The government is not involved in the negotiations given
that it is a dialogue between Telefonica and Portugal Telecom’s
boards,” Silva Pereira said.

He added that the government was still awaiting developments
in the talks after Telefonica “showed willingness to meet the
interests of all the parties” involved.

Portugal Telecom shares extended losses, falling 4 percent
to 8.09 euros after the government’s comments, but pared losses
slightly to trade at 8.16 euros. Telefonica shares were down 1.4
percent at 16.185.

(Reporting by Daniel Alvarenga and Filipa Lima, writing by
Andrei Khalip and Shrikesh Laxmidas; Editing by Michael Shields)

UPDATE 1-Portugal firm on Vivo sale veto under current bid