Telefônica Brasil Approves R$1.5B Capital Reduction

TL;DR

**VIV approved a R$1.5B capital reduction, good for shareholders!**

AI Summary

Telefônica Brasil S.A. (VIVT3; VIV) announced on January 24, 2024, that its Extraordinary Shareholders' Meeting approved a capital stock reduction of R$1,500,000,000.00. This reduction, which does not involve canceling shares or changing the number of shares, follows up on a previous Material Fact disclosed on November 8, 2023. This matters to investors because a capital reduction often signals that the company has excess capital and is returning value to shareholders, potentially through future distributions, which can be a positive sign for stock valuation.

Why It Matters

This capital reduction of R$1.5 billion, without share cancellation, suggests Telefônica Brasil has surplus capital and is optimizing its balance sheet, which could lead to increased shareholder value through future distributions or improved financial ratios.

Risk Assessment

Risk Level: low — A capital reduction without share cancellation is generally a positive or neutral event for shareholders, indicating financial optimization rather than distress.

Analyst Insight

An investor might view this as a positive signal of financial health and efficient capital management, potentially increasing the attractiveness of VIVT3/VIV stock. It would be prudent to monitor for subsequent announcements regarding how this reduced capital will be utilized or returned to shareholders.

Key Numbers

• R$1,500,000,000.00 — Capital Stock Reduction (The total amount by which Telefônica Brasil's capital stock was approved to be reduced.)

Key Players & Entities

• Telefônica Brasil S.A. (company) — the registrant reducing its capital stock
• R$1,500,000,000.00 (dollar_amount) — the approved amount of capital stock reduction
• January 24, 2024 (date) — the date of the Extraordinary Shareholders' Meeting
• November 8, 2023 (date) — the date of the initial Material Fact disclosure regarding the capital reduction proposal
• Law No. 6,404, of December 15th, 1976 (other) — Brazilian Corporate Law governing the capital reduction
• CVM Resolution No. 44, of August 23rd, 2021 (other) — Brazilian regulatory resolution cited in the filing

Forward-Looking Statements

• Telefônica Brasil S.A. may announce a special dividend or share buyback program in the future as a result of this capital reduction. (Telefônica Brasil S.A.) — medium confidence, target: Within 12 months

FAQ

Key Financial Figures

• $1,500,000,000.00 — mpany's capital stock in the amount of R$1,500,000,000.00 was approved, without the cancellation
• $63,571,415,865.09 — y's capital stock will be changed from R$63,571,415,865.09 to R$62,071,415,865.09. The Reduction
• $62,071,415,865.09 — be changed from R$63,571,415,865.09 to R$62,071,415,865.09. The Reduction will be made through a
• $0.90766944153 — s, in local currency, in the amount of R$0.90766944153 per common share issued by the Company,

Filing Documents

• viv20240124_6k.htm (6-K) — 27KB
• viv202401246k_001.jpg (GRAPHIC) — 3KB
• 0001292814-24-000191.txt ( ) — 33KB

From the Filing

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 6-K REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934 For the month of January, 2024 Commission File Number: 001-14475 TELEFNICA BRASIL S.A. (Exact name of registrant as specified in its charter) TELEFONICA BRAZIL S.A. (Translation of registrant's name into English) Av. Eng Lus Carlos Berrini, 1376 - 28 andar So Paulo, S.P. Federative Republic of Brazil (Address of principal executive office) Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F: Form 20-F X Form 40-F Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): Yes No X Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): Yes No X TELEFÔNICA BRASIL S.A. Publicly held Company CNPJ No. 02.558.157/0001-62 – NIRE 35.3.0015881-4 MATERIAL FACT Telefônica Brasil S.A. (B3: VIVT3; NYSE: VIV) (“ Company ”), in the form and for the purposes of Article 157, paragraph 4, of Law No. 6,404, of December 15 th , 1976, as amended (“ Corporate Law ”), and pursuant to CVM Resolution No. 44, of August 23 rd , 2021, hereby informs its shareholders and the market in general that in continuity to the Material Fact disclosed on November 8 th , 2023, at the Extraordinary Shareholders’ Meeting held on this date (“ ESM ”), the proposal for a reduction in the Company's capital stock in the amount of R$1,500,000,000.00 was approved, without the cancellation of shares, pursuant to Article 173 of the Corporation Law, with no changes in the number of shares and the percentage of shareholders’ participation in the Company’s share capital (“ Reduction ”). Consequently, the Company's capital stock will be changed from R$63,571,415,865.09 to R$62,071,415,865.09. The Reduction will be made through a reimbursement to shareholders, in local currency, in the amount of R$0.90766944153 per common share issued by the Company, considering the number of common shares issued by the Company outstanding on this date, which already reflects the cancellation of certain shares issued by the Company held in treasury, carried out on December 22, 2023, according to the Material Fact disclosed on December 26, 2023. Due to the Company's Share Buyback Program, said amount per common share may change considering the Company's shareholding base to be verified on April 10, 2024. Thus, the shareholding position to be considered to receive the resources resulting from the Reduction will be provided for in the Company's records at the end of April 10 th , 2024, and, after this date, the shares issued by the Company will be considered ex-reimbursement rights. The resources resulting from the Reduction will be paid in a single installment, until July 31, 2024, on a date yet to be determined by the Company's Management, to each shareholder individually and in proportion to their respective participation in the Company's share capital, in accordance with the liquidation procedures established by B3 S.A. – Brasil, Bolsa, Balcão (“B3”) and the bookkeeper institution of the Company's shares, as applicable. The Reduction will become effective after the sixty (60) days period of opposition by creditors, beginning on the publication of the ESM minutes, as provided for in Article 174 of the Corporations Law. The Company will disclose, in due course, the documents and procedures to be delivered and observed by non-resident shareholders, for tax purposes, including in relation to any withholding income tax (“IRRF”) on capital gains arising from the Reduction. The Company will keep its shareholders and the market in general duly informed about the progress of the matter. São Paulo, January 24, 2024. David Melcon Sanchez-Friera CFO and Investor Relations Officer Telefônica Brasil - Investor Relations Tel: +55 11 3430-3687 Email: ir.br@telefonica.com ri .telefonica.com.br SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. TELEFNICA BRASIL S.A. Date: January 24, 2024 By: /s/ João Pedro Carneiro Name: João Pedro Carneiro Title: Investor Relations Director

View Full Filing

View this 6-K filing on SEC EDGAR