PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
Brasília, D.F., 71.215-000
Federative Republic of Brazil
annual reports under cover Form 20-F or Form 40-F.
Form 20-F ___X___ Form 40-F ______
in paper as permitted by Regulation S-T Rule 101(b)(1)__.
in paper as permitted by Regulation S-T Rule 101(b)(7)__.
Indicate by check mark
whether the registrant by furnishing the
information contained in this Form is
also thereby furnishing the
information to the Commission pursuant to Rule
12g3-2(b) under
the Securities Exchange Act of 1934.
Yes ______ No ___X___
registrant in connection with Rule 12g3-2(b):
| Investors Relations | |
| (55 61) 415-1140 | |
| ri@brasiltelecom.com.br www.brasiltelecom.com.br/ir/ | |
| Media Relations | |
| (55 61) 415-1378 | |
| cesarb@brasiltelecom.com.br |
FREE TRANSLATION
BRASIL TELECOM PARTICIPAÇÕES S.A.
Publicly
Traded Company
Corporate
Taxpayer Registration CNPJ/MF N° 02.570.688/0001-70
Board
of Trade NIRE 53 3 0000581 8
NOTICE TO SHAREHOLDERS
CAPITAL
INCREASE
BRASIL TELECOM PARTICIPAÇÕES S.A. (“BTP” or “Company”) informs that its Board of Directors, on a meeting held on March 18, 2004, approved a capital increase, as described below.
According corporate restructuring approved in 1999, BTP incorporated the goodwill paid by Solpart Participações S.A. (“Solpart”) in the acquisition of the control of BTP. The objective of this restructuring was the possibility of the use of the tax benefit of R$358,788,247.89 (three hundred fifty-eight million, seven hundred eighty-eight thousand, two hundred forty-seven reais and eighty-nine centavos), generated by the goodwill of R$1,055,259,552.61 (one billion, fifty-five million, two hundred fifty-nine thousand, five hundred fifty-two reais and sixty-one centavos), that will be amortized in 5 years, in compliance with the Comissão de Valores Mobiliários – CVM (Brazilian Securities and Exchange Commission) Instruction 319/99.
In 2003, BTP amortized 12/60 of the goodwill corresponding to R$211,051,910.52 (two hundred eleven million, fifty-one thousand, nine hundred and ten reais and fifty-two centavos), resulting in tax savings of R$71,757,649.58 (seventy-one million, seven hundred and fifty-seven thousand, six hundred and forty-nine reais and fifty eight centavos), that will be used to increase the capital and the share subscription goodwill reserve, in compliance with the CVM rules.
In compliance with article 7 of CVM Instruction 319/99, the capitalization of the tax benefit will be made to Solpart (controlling shareholder), with the extension of preemptive rights for the remaining shareholders, in which the price of the new shares will consider the economic value of company.
The beneficiary of this credit is Solpart, which will receive shares issued under this capital increase and/or cash, in the case of the current BTP shareholders exercise the preemptive rights.
The following table shows the capital increase booked until this moment:
| FISCAL YEAR |
DATE OF CAPITAL INCREASE |
TOTAL AMOUNT OF SHARE SUBSCRIPTION |
NUMBER OF SHARES ISSUEDE |
TYPE OF SHARE |
SUBSCRIPTION PRICE | AMORTIZATION |
| 2000 | 03/23/2001 | R$72,285,279.36 | 4,090,847,728 | Common | R$17.67 | 12/60 |
| 2001 | 03/26/2002 | R$71,757,649.58 | 3,895,637,871 | Common | R$18.42 | 12/60 |
| 2002 | 03/17/2003 | R$71,757,649.58 | 1,676,172,072 | Common | R$13.34 | 12/60 |
| 2,806,676,939 | Preferred | R$17.60 |
Total Amount of Share Subscription:
R$71,757,649.58
Total Amount of Capital Increase:
R$23,807,580.09
Total Amount of the Share Subscription -
Goodwill Reserve Increase:
R$47,950,069.49
Number and Class of Shares to be Issued:
3,337,565,097 preferred shares, without par value.
Issuance and Subscription Price:
R$21.50 per
lot of one thousand shares.
Reasons for the Issuance Price:
BTP believes
that its preferred shares have considerable liquidity in BOVESPA (São Paulo Stock’s
Exchange) and for that reason the Company based the issuance price on average prices
between March 4, 2004 and March 17, 2004.
The choice of using average prices in the stock exchange is based on article 170 of Law 6,404/76, which allows the use of that price in determining the economic value of shares. In addition, CVM Guideline (Parecer de Orientação) 01/78 indicates average prices as the preferred criteria for determining the economic value of shares, given that the shares have a sufficient standard of negotiability and that the market is well informed about the Company.
Conditions for Payment:
In cash upon
subscription.
Period for the Exercising the Preemptive
Rights:
From March 19, 2004 to April 19, 2004
Shares traded on or before March 18, 2004 shall be deemed to carry subscription rights. From and after March 19, 2004, shares shall be traded without subscription rights.
Number of Shares to Be Subscribed under
Preemptive Rights:
In order to determine the number of shares to be subscribed under
preemptive rights, the shareholder should multiply the number of shares held on March 18,
2004 by the following factors:
| Class of Shares | Factor | Class of Shares to be Subscribed |
| Common | 0,009395740629 | Preferred |
| Preferred | 0,009395740629 | Preferred |
Note: Holders of BTP American Depositary Receipts must not subscribe to purchase additional shares or American Depositary Receipts in the preemptive rights offer.
Subscription Bulletin:
In order to obtain
the Share Subscription Bulletin or trade their subscription rights, shareholders must
present the following documents to the Banco ABN AMRO Real S.A., depositary institution
for shares issued by the Company:
a) Natural persons: Original identity card and
Individual Taxpayer Registration (CPF) card, or certified copies;
b) Legal persons:
Original Federal Corporate Taxpayer Registration (CNPJ/MF) card and current
consolidated articles of association (contrato social) or bylaws (estatuto social). The
bylaws must have attached the minutes of the shareholders’ meeting at which the current
officers (diretoria) were elected. Managing partners (sócios-gerentes) and officers
(diretores) with powers to represent the company must present a certified copy of their
identity card, Individual Taxpayer Registration (CPF) card and proof of address.
Where shareholders are represented under power of attorney, the public instrument of grant of power of attorney and certified copies of the attorney’s identity card and Individual Taxpayer Registration (CPF) card must be presented.
- Shareholders wishing to trade their subscription rights during the period for exercising the preemptive rights should request an instrument of assignment of rights, which will be issued by the Depositary Institution for shares issued by the Company or by the Custodian Entities;
- The Custodian Entities can only issue one assignment of rights to each subscriber;
- Once an assignment of rights has been issued, a new one must be issued in the case of a new sale;
- The Custodian Entities will be able to subscribe for themselves, as fiduciary proprietary, up to the limit of shares in custody;
- A copy of the assignment of rights will not be accepted in any circumstances.
Unexercised Subscription Rights:
Unexercised
subscription rights shall automatically be extinguished, once the capital increase is
related to the goodwill tax credit capitalization.
Dividends:
Shares resulting from this
capital increase shall carry rights to full dividends or other capital remuneration
announced from this date on and relative to the 2004 fiscal year.
Services to Shareholders:
Any branch of
Banco ABN-AMRO Real S.A.
Brazil, Brasília, March 19, 2004
Paulo Pedrão Rio Branco
Investor Relations
Officer
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BRASIL TELECOM PARTICIPAÇÕES S.A.
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| By: |
/S/
Paulo Pedrão Rio Branco
| |
|
Name: Paulo Pedrão Rio Branco
Title: Financial Executive Officer
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