June 19, 2020 / 7:04 PM / 2 months ago

UPDATE 1-Board of Brazil's TIM approves $120 mln in quality upgrades under regulator pact

(Adds analysts’ comments, updates share performance)

By Gabriela Mello

SAO PAULO, June 19 (Reuters) - Brazilian telecoms firm TIM Participacoes SA said on Friday its board has approved an agreement of conduct adjustment with local regulator Anatel that includes 639 million real ($119.5 million) in spending to improve the quality of its services and customers’ experience.

TIM, the local subsidiary of Telecom Italia SpA, reported the move in a securities filing.

The agreement, which is locally known as TAC, also requires the carrier to bring broadband services through its 4G network to approximately 350 cities with fewer than 30,000 inhabitants.

“The new infrastructure will be deployed within three years, with over 80% of it delivered in the first two years,” TIM said.

About 3 million people in the northern and northeastern regions of Brazil, as well as in midwestern states of Minas Gerais and Goias, will benefit, the carrier added.

In a separate statement, the president of Brazil’s telecoms watchdog Anatel, Leonardo de Morais, said the agreement signed with TIM serves the public interest.

Analysts at Guide brokerage saw the TAC announcement as positive, given that it replaces regulatory fines for investment commitments.

They noted that TIM and Anatel had been negotiating the TAC agreement for more than two years, and the final value was revised to 639 million reais from 627 million reais previously.

Shares in TIM were trading 0.6% down on Friday afternoon at 14.52 reais. ($1 = 5.3477 reais) (Reporting by Gabriela Mello; editing by Jonathan Oatis)

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