Turn Around and Sale

Vésper was a telecommunications company with operations in 17 states, 185 cities in Brazil, covering 130 million POPs. Vésper operated the largest wireless CDMA network in South America, covering 80 cities with more than 200,000 inhabitants. The company provided a wide range of telecommunications services for the corporate and consumer markets.

Vésper was started in 1999 by Velocom (50%), Bell Canada (36%) and Qualcomm (14%) and it was operated by Bell Canada. In May 1999, after investing over US$ 2 billion (US$ 800 million in equity and US$ 1.3 billion in debt), Vésper was technically bankrupt.

LKaufmann joined the company in May 2001 with the mission of turning around and selling the company. Six months later, in November 2001, the company received US$ 356 million in new equity, used US$ 150 million to buy back US$ 1.2 billion in debt, with one of the largest discounts ever achieved in similar transactions.

In parallel, operations were completely restructured:

  • Product and marketing strategies were completely revised;
  • New products were launched;
  • New distribution channels were introduced;
  • New credit policies and price plans were introduced to reduce bad debt;
  • Staffing was reduced from 4,000 to 1,600;
  • Network was optmized;
  • All suppliers' contracts were drastically renegotiated, in particular, backhaul and longhaul contracts.

The company was sold to Embratel.