Portugal Telecom confirms it did not receive the repayment of more than $1 billion in debt from Rioforte, a unit of troubled bank Espirito Santo. Portugal Telecom is now forced to take a cut in its share of the merger wtih Brazil's Grupo Oi as a result. The Deal's Andrew Bulkeley explains how damaging this is for Portugal Telecom and how large the losses tied to its exposure to Espirito Santo may be. Going forward, Bulkeley says it will be crucial for Portugal Telecom to fight to win back the confidence of shareholders as well as Oi, especially after the company did not disclose the loan to Rioforte, a "skeleton in its closet." TheStreet's Brittany Umar has details.
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