Sonae (Portugal) warns on its PT bid

The Sonae' s bid on Portugal Telecom is going on, with Sonae buying last week about 1% of PT for $135m, a move that forces PT to open its books to Sonae under Portuguese law. After Vodafone complained to the Portugal's Competition Authority (PCA) about such a merger and its logic consequence of merging the two mobile units: Sonae' s Optimus with PT' s TMN, Sonae warns that if the Competition Authority won't let it merge mobile units, it will drop the hostile bid on PT. The problem is serious as the new mobile operator should control about 2/3 of the Portuguese mobile market, and leave Portugal with only two mobile operators. Sonaecom' s CEO is making suggestions to the Competition Authority for an acceptable solution. One of them is to merge the units but continuing to market both the TMN and Optimus brands. PCA decision is expected in July.