Spanish telecommunications giant Telefonica on Saturday pulled out of negotiations to acquire a ¤7.15 billion ($9.3 billion) stake in Brazil's leading cell phone company Vivo, AP reported. Telefonica said in a statement to Madrid's stock exchange early Saturday that the deal fell through after Portugal Telecom's board of directors failed to accept the Spanish company's offer by the deadline. «The deal has been extinguished,» Telefonica said. Though PT shareholders voted two weeks ago to accept the offer, the Portuguese government used special voting rights to block the sale, citing national interests. The European Union's Court of Justice then ruled that the Portuguese government's blocking of the deal was illegal. Telefonica and PT each own 50 percent of Brasilcel, a Dutch holding company which owns 60 percent of Vivo. The Spanish company's offer was to buy PT's half of Brasilcel and following the court's finding it extended the offer until July 16. Telefonica is eager to expand its significant presence in the fast-growing Latin American sector, where it has an important foothold in burgeoning markets such as Chile, Colombia, Mexico, Peru and Venezuela and Brazil. Brazil's economy is booming, in contrast to Telefonica's home territory of Spain which is struggling to emerge from nearly two years of recession. -- SPA
