Oi SA (BRTO4), the company formerly known as Brazil Telecom SA, fell after Morgan Stanley said it expects the telephone company will cut dividend payments in half.
Oi fell 2.5 percent to 9.15 reais at close in Sao Paulo. The benchmark Bovespa index dropped 0.7 percent.
Michel Morin, an analyst at Morgan Stanley, said Brazil’s second-biggest phone company may cut its annual dividend payments to 1 billion reais ($546 million) from 2 billion reais. It’s “unlikely the 2011 dividend of 2 billion reais is sustainable going forward,” Morgan Stanley said in the report.
Oi’s press office said it will announce plans for its dividend at a meeting with investors on April 17 and declined to make additional comment.
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