OREANDA-NEWS. According to the latest of Fitch Ratings' 10-report series titled '10 Most Distressed LatAm Corporates,' Oi S.A.'s (Oi) rating depends entirely on whether the merger with TIM Participacoes S.A. (TIM) takes place.

We intend to release one report each day through February 12 as per the schedule found at the end of this release.

"A successful merger with TIM, based on an equity-swap deal without any additional undertaking of debt, should result in an immediate ratings upgrade, potentially up to investment grade," said Alvin Lim, Director.

"Oi's failure to merge will pressure its ratings into the 'B' category, as Fitch does not foresee any meaningful turnaround in the company's credit profile based on its current operational fundamentals."

With Oi a good strategic fit for TIM, Fitch believes a merger is more likely than not, since progress has been made with Oi's precarious balance sheet and the outdated regulatory framework Oi was subject to.

Fitch believes Oi will propose an official offer to TIM by the end of February 2016.

Fitch's 10 Most Distressed LatAm Corporates series will be released one report per day as follows:

Feb. 1st: Samarco Mineracao S.A.
Feb. 2nd: Companhia Siderurgica Nacional
Feb. 3rd: Pacific Exploration and Production Corporation
Feb. 4th: GOL Linhas Aeresas S.A.
Feb. 5th: Oi S.A.
Feb. 8th: GeoPark Latin America Limited Agencia en Chile
Feb. 9th: Ajecorp B.V.
Feb. 10th: TV Azteca, S.A.B. de C.V.
Feb. 11th: QGOG Constellation S.A.
Feb. 12th: Odebrecht Offshore Drilling Finance Ltd.