Good morning, ladies and gentlemen. Thank you for standing by, and welcome to Oi S.A.'s conference call to discuss the Q3 of 2019 results. This event is also being broadcast simultaneously on the internet via webcast, which can be accessed on the company's IR website, www.oi.com.br/ri, together with the respective presentation. We would like to inform that during the company's presentation, all participants will be only able to listen to the call. We will begin the Q&A session when further instructions will be given. In case you need any assistance during the conference, please request the operator's help by pressing star zero. We also would like to inform that the conference call will be conducted in English by the management of the company, and the conference call in Portuguese will be conducted via simultaneous translation.
This conference call may contain some forward-looking statements that are subject to known and unknown risks and uncertainties that could cause such expectations to not materialize or differ materially from those in the forward-looking statements. Such statements speak only as of the date they are made, and the company is under no obligation to update them in light of new information or future developments. I will now turn the conference over to Mr. Rodrigo Abreu, COO. Please, Mr. Rodrigo, you may proceed.
Thank you. Well, good morning, everybody, thank you all for participating in our call. As you know, after a year as a board member, I accepted the challenge of helping to execute our transformation plan as an executive. For the last two months, at the very beginning of Q4, I have been working with the leadership team of the company so we can accelerate all of the actions we announced as part of our strategic plan a few months back. As part of this journey, we already had some changes in our leadership team. Today I have with me in the call, Camille Faria, our newly appointed CFO, Antonio Rabelo, who also just joined as our new legal counsel, as well as the other members of our executive team who will be here available during the Q&A session.
The call today will obviously bring our Q3 results, but we will focus primarily on how they relate to the execution of our strategic plan and our long-term objectives, strengths, and indicators. We know that we have several critical tasks ahead, but myself and the team feel confident on how we started the execution of the plan on the H2, despite the challenging scenario, primarily due to the fast reduction of the legacy revenues based on copper, while we are still accelerating the new revenues based on fiber. When we start on slide three, we would like to start by revisiting our strategic plan to understand the context of our execution and results on Q3. As stated in our plan, our scenario is still impacted by the legacy services and revenues or our past.
The revenue has high exposure to the declining services and products on copper, DTH, regulated services, and prepaid mobile, which used to be the focus of the company. Also in our transformation plan, we highlighted our future, and the future focuses on a migration to higher value areas, including FTTH, which will be the lead service for residential services. On B2B, including both corporate segments and the small and medium enterprises. On the migration of TV to IPTV and OTT. On being a provider of transport network and 5G infrastructure, acting as a wholesale provider. On the increase of our mobile operation with a focus on postpaid. To get there, we know that we must execute on three fronts simultaneously.
The first one is obviously the strategic business initiatives, with an emphasis on the fiber acceleration to compensate the copper decline and the continuity of the mobile growth strategy. The second area is obviously the funding of this journey with the sale of non-strategic assets, the fundraising initiatives, and obviously the use of tax credits and other sources of funding. The third one is the simplification and cost reduction efforts, where we have projects being implemented with financial impact already expected for 2020. Let's talk about some numbers which reflect the highlights of our plan progress towards a new revenue base in the next slide. On slide four, we can see that we have positive numbers in most of the focus areas for our strategic plan.
We start with a number of 3.6 million homes passed with fiber at the end of September. Expecting to reach 4.6 million by the end of 2019 and 16 million by the end of 2021. By this number, we can see that we have a great rhythm of deployment. We also were able to reach 11.4% of homes connected over homes passed with fiber in September, which is a very significant progress from the beginning of the fiber operation. This means not only a great rhythm of sales, but also of activations. We can also highlight the number of 36% market share of net adds in postpaid in the Q3 2019, which is an excellent performance on mobile. In particular, amidst a very competitive scenario, which positions Oi as one of the two players with the highest performance in net adds of postpaid in the last 12 months.
We can also point out to the 13.8% year-on-year growth in our postpaid customer revenues, this is leading us back to revenue growth on mobile following a long period of deceleration. We can point out to the growth of IT contracted revenue year-on-year of 192%, contributing to the total Corporate Segment revenue growth, which is one of the priorities for the company in the mid to long term. Let's talk about some numbers in more details, which reflect the highlights of our plan, progress towards this new revenue base. On slide five, we can talk about Fiber, and we see that Fiber already has a sizable positive impact on the overall picture of our revenues. The operational and financial indicators are in line with plans, confirming the good execution of the strategy aimed at replacing our legacy copper revenues.
Starting with the fiber deployments, we can see that our number of homes passed with fiber continues to increase very rapidly, and in October, we already reached close to 4 million homes passed with fiber. This obviously is followed by homes connected with fiber, and we continue to present a fast growth of our customer base. By the end of October, this number was already approaching 500,000, and we expect to get to a much higher number by the end of this year. This reflects in a steep revenue curve for fiber, as we can see in the middle chart, and our fiber revenues during 2019 have already grown 4.2 times, confirming the good performance of the fiber product, the fiber installations, and the revenue performance. Obviously, this performance is aimed at compensating our legacy revenues, which continue to drop significantly, as we can see by the chart.
During the nine months of 2019, we had a decline of 11% on copper voice revenues, copper broadband revenues, and DTH, which are the legacy services, which we are de-emphasizing from now on. Also, when we look at the complete picture, we start to give you details of our revenue composition, in particular on the residential revenues on the right-hand side of the page, where you can see that despite a decline of 13.5% on overall revenues, we can see that fiber already starts to appear in the picture as a positive contributor, which will eventually substitute the drop and compensate the decline to revenue growth. Just on legacy services, it's possible to see that we had a BRL 350 million drop on our revenue, which obviously impacts the overall revenue picture on the short term.
When we look at contracted revenue, new sales, we can see that the drop in contracted revenues on copper plus DTH was almost entirely compensated by the growth of contracted revenue in fiber. It's a minor difference for the 10 months 2019, and we expect this curve to invert in the coming months. When we look at broadband only, the impact is yet more visible, and we can see that in the next slide. On slide six, we can see that cities with fiber are already showing a significant improvement on all of the broadband indicators. Even with still a reduced number of cities, we can see where we are headed. We start by looking at the accelerated learning curve that we have been having in the deployments of fiber and the commercial strategy associated with them.
The FTTH penetration per cohort of installation shows a great progress with our first cohorts taking several months to reach 10% of take-up, and the most recent cohorts already starting at the 10% or higher take-up rate level. We can see excellent sales acceleration on the right-hand side, our broadband mix sales mix has improved from the Q1 2019 to the Q3 2019, from 12% to 42%, and it continues to increase very rapidly as we expect November to have 71% of sales mix skewed towards fiber. This leads to a stabilizing customer base on broadband. With the 52 cities with fiber, our FTTH base growth virtually offsets the large drop in the copper customer base.
We can see that there is a marked difference from the cities without fiber, a drop of 14.5%, to the cities with fiber in a drop of only 3.6%, and only with 52 cities. As the number of cities grow, this number will obviously stabilize. Also, this revenue base comes with a better ARPU, leading to broadband revenue growth. The broadband ARPU from copper to fiber is increasing at the clip of 57% higher ARPU. This leads to a broadband revenue growth in the cities where we have fiber, despite obviously the overall loss of broadband revenue as we are still with the reduced number of cities and growing for the future. In summary, we have great progress on residential fiber, which is one of the key pillars of our strategy. Now let's look at mobile on page seven.
On page seven, we can see that the mobility revenue reversal trajectory continues with very positive results in postpaid and better than market average performance. We are maintaining and increasing the value of our mobile operation by focusing on all of the right leverages. On postpaid, we can see impressive commercial performance. We were second in terms of share of net adds during 2019 by a very significant margin. When we look at our growth of the postpaid customer base, we see a significant increase. This consolidates the upward trend of our postpaid revenues and the improvement in the mix of mobile revenues after all. Our postpaid revenue trends are showing a 13.8% increase in the Q3, leading to a revenue mix which is approaching 53% of postpaid compared to prepaid. Also in prepaid, we experienced good results.
Despite a highly competitive and overall shrinking market, we managed to increase our market share as well by having a less steep reduction of prepaid customers compared to the market average. With this, we were able to gain one percentage point of market share in the overall prepaid scenario. The good performance on both postpaid and prepaid has led us to an overall very positive result in mobile, with an increase in mobility market share and the start of the growth of mobile revenue comparing Q3 to Q2, and a virtual stabilization compared to last quarter of the last year, and leading to an expectation of mobile revenue growth for the future. Now let's look at the B2B performance, which is the third pillar of our strategy.
On page eight, we can see that our corporate revenue has grown and already starting to capture the first results of the execution of our strategic plan. B2B will also benefit from fiber, is in the middle of a comeback, which starts with the corporate segment net revenues. Our key segment is that of the corporate clients, and we return to growth in Q3 with a 1% growth, which indicates a positive trajectory. This positive trajectory is being made possible by a new positioning, Oi Solutions, which aims at creating higher value offers for our customer base and adding as a role of integrator and provider of both telecom and ICT information and communication solutions. Our strategy of bringing complete solutions to corporate clients is already starting to bear fruit, and we can see this in the great growth in contracted revenues, with IT being already a key component.
Obviously, IT grows as part of the total mix, and this helps compensate the pressure on traditional revenues, which are based on voice and legacy services. On the small and medium enterprise segment, revenues continue to decline because the segment is still very impacted by the reduction of legacy services in the same trend as residential. Soon, we expect to address this trend based also on fiber growth and specific offers focused as the SME segment. Our last area of focus is wholesale. On the next slide, let's look at some key indicators for the segment. On page nine, we can see that on wholesale, our strategy starts to be focused on the unregulated market, leveraging our infrastructure leadership and offerings for areas of growing demand.
The business here is also undergoing an important transition from legacy to new revenues, and we can see this when we break down the revenues between regulated and unregulated revenues. Our regulated revenues have obviously continued to decline because they are based on copper and low-speed EILD, which is the regulated service offering. Our unregulated revenues started to grow again, including both the service offerings and the infrastructure rental revenues. Our areas of growth to continue expanding on the performance of wholesale are areas which will bring strong demand in the near future, including IP connections and fiber to the ISP, fiber to the tower, which will help the growth of 4.5G and 5G, and infrastructure monetization. This will lead to an increase, with the ever-expanding percentage of unregulated revenues on the total mix of wholesale revenues.
Finally, an important action of wholesale will come in the form of the Oi franchise model for ISPs in the regions where we will not be operating directly initially. This will help complement our FTTH coverage and will be operated as a wholesale business. All of the transitions that are being made here are possible by the efficient investments, and we expect them to bear fruit in the coming years. Let's now look at our CapEx numbers in the next slides. On slide 10, we can see that the company CapEx is in line with their strategic plan, focused on deploying homes passed with fiber and refarming 1.8 GHz sites to 4G and 4.5G. This indicates the continuity of the good execution on our CapEx plan, which is fundamental to the success of the mid-long-term strategic plan.
We can see that the CapEx rhythm in Q2 was sustained in Q3, and obviously compares much favorably to the investments in 2018. On HPs deployed, we are operating at a rate of almost 400,000 homes passed per month, which is a significant level of operation, and we expect to get to 4.6 million in 73 cities by the end of 2019. One of the largest FTTH projects globally is being deployed by Oi, and this is the rhythm of deployment that makes it possible. On mobile, we continue to focus on the refarming on 4G and 4.5G sites, and we have been having good traction on the mobile CapEx using our ample 2G spectrum position for refarming. Next, I'll hand over the presentation to our CFO, Camille Faria, who will talk about the efficiency and simplification initiatives and also the funding components of our plan. Camille?
Thank you, Rodrigo. Good morning, everyone. Turning to slide 11, during the Q3 of 2019, we managed most cost lines, allowing the company to focus on its new plan. We had an overall OpEx reduction, which could have been higher, but was offset by our investments in marketing to support our strategic plan through sales campaigns, sponsorships, among others. We had reductions in important areas such as personnel, network maintenance, and we have the possibility to show additional improvement in other lines in the Q4 of 2019. The result of the revenue behavior described by Rodrigo and the costs that I've just described, led us to an EBITDA of BRL 1.8 billion in the quarter, a challenging Q3 for EBITDA with a 20.3% margin.
We're still maintaining our guidance for the 2019 EBITDA, of course, now more towards the bottom of the range of BRL 4.5 billion-BRL 5 billion. While OpEx was reduced in the Q3 of 2019, our OpEx efforts still do not reflect the ongoing structural initiatives on the simplification and cost reduction, which we will talk about in the next slide 12. Talking about more structural changes in our OpEx, we have now five ongoing initiatives in key areas with significant estimated impacts for 2020. We will start giving details on some key metrics for cost reduction that we will be following internally to help everyone keep track of the evolution of these efforts. The first one is related to sales, marketing, and customer service, through which we expect to save between BRL 150 million and BRL 200 million a year.
It's related to pursuing portfolio simplification, so basically migrating our clients to flat rate plans. A reduction of proactive selling actions in our legacy portfolio and the acceleration of sales through digital channels. Some of the metrics that we will be following, just to give you an example of what we expect. We expect to have by the end of 2020, an increase of 46 percentage points in the percentage of fiber in broadband activations of the company. An increase of 23 percentage points of our residential base in flat rate. A reduction of 20% in the volume of calls that are answered via human customer services, and an increase in 14 percentage points of digital invoices. Our second key initiative here is process and organization. We already had a start in that area. The financial functions are now centralized under the new CFO, myself.
We also had a creation of an executive leadership position for business support and operational efficiency reporting directly to the COO. More importantly, we just started a simplification project with the support of Visagio Consulting. Through this second effort, we expect to achieve an additional between BRL 100 million and BRL 150 million a year of cost savings starting in 2020. The third initiative is related to business support, which I just described, the executive position that has just been created. This is a very relevant initiative because a huge portion of our costs are concentrated in supply chain, energy, logistics, business management, and infrastructure. We have a strong focus in these areas. We expect to have back office reduction, energy efficiency initiatives that will allow us to achieve an additional between BRL 150 million and BRL 300 million of cost savings a year.
Just as an example of potential of metrics that we will be following, we expect to have a 12% reduction in energy costs per megawatt hour of the company, an important cost line for us. Also a reduction of 1.8 percentage points in bad debt as a percentage of our revenues. The next initiative that we have is in IT. We are starting a reduction or interruption of IT legacy projects, and a development of a new IT stack for fiber operations, which will reduce costs. Also our digital initiatives, which used to be focused on customer care only, are now being elevated to a company-wide effort. Through the IT initiative, we expect to achieve another BRL 100 million-BRL 200 million cost savings starting in 2020.
Just to give you an example on metrics, we expect to increase the percentage of our agile IT projects by 26 percentage points in this initiative. The last one is related to network and operations, and of course, is a result of our accelerated customer migration to fiber and a reduction of legacy sales efforts, which will allow us to optimize and decommission the legacy network, so copper and DTH. With this initiative, we expect to achieve another BRL 120 million-BRL 200 million of cost savings. Just an example of metrics in this area, we expect to increase by 37 percentage points, the percentage of fiber technical support through digital channels. With the cost reduction expected for the midterm, we need to execute our plan with funding alternatives in the short term, which I will describe in the next slide. Going to slide 13.
We are working on multiple funding alternatives, not to depend exclusively on any single option. On the non-core asset sale front, Unitel is expected to be concluded still in 2019, as the company has been communicating to the market. The sale of other non-core assets such as data centers, towers, and others that the company has described in the past, are now ongoing processes. After a somewhat long preparation processes, the sale processes are finally on the road. Real estate, we have several initiatives in place with some more immediate ones. On the Polidoro building front, we are awaiting a final dispatch from Anatel after a successful due diligence. We have an estimated sale value of BRL 120 million for this particular piece of real estate.
We are also focused on the sale of other five non-reversible assets in an estimated amount of BRL 300 million over the next few months. On the fiscal thesis front, all credits have now been recognized and approved. We have a total of BRL 3.1 billion, and we are already realizing savings of roughly BRL 100 million per month. This is already in progress in the Q3. On the funding activities, if you remember well, our recovery plan allows us two additional credit lines. One is a BRL 2 billion credit line linked to the purchase of equipment, and the other one is a BRL 2.5 broader credit line. Regarding the latter, the company continues to work towards a public debt offering, and we expect to be ready to tap the market quite soon. As an alternative plan, we are working on a $600 million bridge loan.
The negotiations are ongoing, with an immediate $400 million firm commitment. This is aimed at giving the company flexibility in case the capital market conditions are not deemed appropriate for us to issue a public debt right now. Regarding the first line that I mentioned, we have an ongoing negotiation process for this credit line linked to the purchase of equipment, but this is in somewhat earlier stages with respect to the 2.5. Looking at our cash flow, we had a BRL 1.1 billion cash consumption in the Q3 2003, which led us to a BRL 3.2 billion cash position for September 2019. Our gross debt increased from BRL 16.8 billion-BRL 17.9 billion, reflecting the cash consumption in the quarter, supporting the strong CapEx that Rodrigo described. We closed September 2019 with a BRL 14.7 billion net debt position.
I will turn the call back to Rodrigo, who will conclude our presentation with some key messages. Thank you.
Thank you, Camille. As we have highlighted, not only during the presentation of our strategic plan, but also during the presentation of the Q3 results, to create the future Oi, our focus now is on strategy, implementation, and investment capacity. We are executing on multiple fronts to make it happen. Just to very briefly highlight all of them, we start with funding in the short terms with all of the initiatives that Camille has mentioned. We move to a business execution as a must, and we have several strategic initiatives on this front, including the main one of pursuit of FTTH leadership, corporate, wholesale, and the maintenance and increase of our mobile value. We are looking for a structurally simpler company with several initiatives of efficiency and simplification, which will help us bring structural cost reduction.
All of this is enabled by a transformation effort based on people and leadership. We have already set up a transformation management office, and we are making it happen based on a very significant follow-up and due diligence of execution on a daily basis. This execution comes with a renewed emphasis on some of our key principles. Starting with the customer at the center, being digital at everything, and not only at one or other aspects of the company. Going back to innovation, which actually helped us create the Oi that was successful in the past, and maintaining and improving quality, which has been done throughout the period of the RJ and will continue to be done in the future.
We know that our plan requires a lot of dedication, a lot of simultaneous tasks, but we have been seeing progress in the areas where we dedicated our efforts initially. We are energized, we are confident in the great opportunities for the company in the near future, and we have a great team to make it happen. With that, I would like to open up the floor for Q&A. For the Q&A, we have the whole executive team of the company here to help us respond to more specific questions. Thank you.
Ladies and gentlemen, we will now begin the Q&A session for investors and analysts. Remember that questions should be asked in English, and those questions sent via webcast will be prioritized. If you would like to ask a question by the telephone, please dial star one. If at any point your question has been answered, you may remove your question from the queue by pressing star two. Mr. Fred Mendes from Bradesco would like to ask a question.
Hey. Good morning, everyone. Thanks for the call. I have two questions here. The number one, if you can just give us an update. I know, of course, you mentioned the presentation that for Unitel, the non-GAAP guidance, but the view that it should be completed by the Q4 , it is maintained. Also, I think my question here is more regarding the process, the brokers of the process. When would you make an announcement to the market regarding this sale? Would you make an announcement when you actually sign the deal, or you can only make an announcement maybe once the money enters your balance sheet? Just to try to figure out the timing here. This is my first question. Then my second question, I think it's more on the fiber front. The penetration of 12%, it is improving, but it's still relatively low.
Just trying to wonder how we can increase this penetration. The other question is regarding the Homes Passed. I think the equipment is the most expensive part, or something like BRL 1,000, if I'm not mistaken, per house. Just wondering if you have an agreement with Huawei or any other supplier where they can anticipate the equipment and then you pay later. Just how this dynamic works, because of course, it should be quite important for your CapEx as you expand on the fiber. Thank you.
Thank you, Fred. Well, on your two questions, let's start with Unitel. As we have been stating for a long time now, obviously, we believe we're getting closer to the conclusion of the process. We reiterate our confidence on closing the process by the end of the year. As far as details about the process, Fred, the reason why we have decided not to publish any details about the process is obviously because it is a complex process, and obviously, there are confidentiality issues associated with it. We have decided to announce only that we feel confident, we continue to feel confident that this process can be concluded. As far as an announcement, we will know when an announcement is made at the appropriate time.
Important to highlight that obviously, the process, when we talk about the sale of Unitel, also relates in particular to the sale, not of Unitel directly, but of PT Ventures in Portugal, not in Angola. Obviously, we will hear more news when we have the news to communicate to the market. As far as your second question on the take-up rate of fiber. On one comment, which is the 12% is not a low rate at any measure. If we look at the comparables that we have been experiencing in terms of looking at other fiber operations, in some cases, we have seen companies taking almost three years to get to 20% take-up rates. Our operation has less than 12 months, and in 12 months, we're getting to the 12%.
If you look at the new cohorts, the cohorts that started to be deployed and implemented in the most recent months, we already start the month with a take-up rate above 12%. The progress is very significant in the new cohorts. Obviously, it's a matter of fine-tuning our commercial strategy, fine-tuning our deployment strategy, better selecting based on analytics and big data metrics so that we continue to monitor every day where we're going to install next. We feel very pleased with the results of the fiber take-up rate so far. Much so that as of last month, we already started to see that the sales of fiber are bigger already than the sales of all the legacy products combined in terms of RGUs.
This is very significant, with this, we can only see the take-up rates increasing very rapidly and going to where we believe they should be. If you remember our guidance, we talked about a 25% take-up rate in two to three years. We are almost at the end of the first year or beginning of the second year of operation, we already are at the 12% mark. We feel very confident, we believe that this is a very good metric that we will continue to publish and track and communicate to you. As far as the agreements for equipment purchases, we do have a pay-as-you-go contract in place with our two key vendors, both Huawei and Nokia.
Not only that, but we have been working with those two vendors not only to improve our purchasing conditions, but also to improve our technical solutions. In the last rounds of technical architecture discussions, we have been revamping our technical architecture in search of cost reductions that can go up to 20%, 30% per Homes Passed, which is very significant when we're talking about a project that aims at covering almost 16 million-20 million Homes Passed. We believe we are executing on this front. The strategic vendors have been good partners in helping us make it happen, and for sure, they will continue to do so.
Perfect. Rodrigo, very clear. I just make one question here, a follow-up. When you mean conclusion of Unitel, you mean cash in the bank, cash in the company's balance sheet, or could be just the signing of a deal? Thank you.
No, when we talk about conclusion, we talk about a completion of the whole process. Okay?
Perfect. Thank you very much.
Thank you.
Miss Susana Salaru from Itaú would like to ask a question.
Hi. Good morning, guys. Thank you for taking our questions. The first one, if you could elaborate a little bit about the competitive landscape for fiber. We see that the company is progressing strongly in deploying the fiber and increasing the penetration. How is the competitors reacting in those regions? That would be our first question. The second question is related to the dividend payment that were allowed to be paid to the PT Ventures. If you could elaborate, explain that if there is any positive implications for Oi as well. Thank you.
Thank you, Susana. Well, first on the competitive landscape of fiber. This is not a new scenario. Obviously, the growth of high-speed broadband is the new frontier, and fiber is obviously the way to get to this new frontier. As such, many companies, both big and small, have started to invest in this area. What we believe we have when we compare ourselves to the competitors in the multiple different areas where we have been focusing, is the advantage of having the infrastructure already on the ground. With this, we have selected the areas where we believe we'll have better traction first. Obviously, this will help us not only achieve our results fast, but establish a stronghold in most of those areas. What we have been experiencing and observing is the following.
When we look at the areas where we have implemented fiber, even when competing with established small ISPs, and we have been seeing this. I myself personally visited a fiber installation last week in the state of Bahia. We see that the level of quality that the Oi Solutions, the Oi fiber brings, and the level of confidence in the brand allows us to take back share from small ISPs. The installation I went to, for instance, it was an installation where we took back share from an ISP that was supposedly delivering close to 100 meg, but the Oi fiber was of much, much higher quality at approximately the same price. It's not a matter of just a price competition. It's a matter of a competition that will be a lot based on quality, confidence, and customer service from now on.
We feel confident we can play against those players in the areas where we do have the infrastructure. As far as competition with the large players, we have to remember two facts here. The first one is that the largest player of broadband in the country has invested in a strategy a long time ago, which was a very successful strategy, but based on HFC, not fiber to the home. It was fiber to the curb, and then a last-mile connection with coax cables. This was very successful, but when we look at the future of broadband, obviously this has technical limitations. As such, we feel very confident that we can again go head-to-head with competition for higher speeds, for higher quality, and be successful in playing against the HFC installations.
This is also valid for the second-largest player, which has acquired an operation in the past, which was not FTTH as well, which was FTTC, with DSL last-mile connections. A lot of the presence of this second-largest operator of broadband is based on DSL connections on FTTC. Obviously, even though it allows for interesting speeds and interesting service two, three years ago, now they will start also to face limitations and will have to migrate the whole strategy and infrastructure to fiber, to pure fiber, if they want to compete. With this, we feel very confident at the competitive performance, even in the areas where there is already existing competition. Obviously, we are doing an analysis of deployment based on a big data analysis, which look at very, very fine granularity of where we will install fiber next. Okay.
On your second question, regarding the dividends that you saw as part of the quarterly report. Obviously, when we look at a project such as Unitel, we will not only focus on the sale process, which we have been focusing on, which we continue to reiterate the confidence that it can happen and it can be completed by the end of the year. We also have been going at different routes of extracting value from the assets that we already have. The repatriation of dividends based on the retained dividends position that we already have in the company is also a route that has been pursued and that is starting to bear fruit. Obviously, when we look at the funding initiatives, as Camille mentioned, we are trying not to depend on any single event.
We will do everything that is at our disposal in terms of looking for different funding alternatives. This is a reflection of that, just as we highlighted during the presentation.
Perfect. Thank you, Rodrigo. Very clear.
Thank you, Susanna.
Mr. Samit Data from News Trade would like to ask a question.
Hi. Two questions, please. Two, could you give an update on how we should be thinking about the CEO role going forward? Secondly, in a slightly more conceptual question. The wireless business has been performing strongly. Obviously, there's very strong volume in data growth. For how long do you think that business can perform as well as it has done without a step-up in investment and without further spectrum? Thank you.
Thank you, Samit. Well, on the first one, about the executive leadership, what we have been doing, Samit, is really refocusing the whole leadership structure of the company to execute the strategic plan. This started when I came on board in early October. As part of that plan, we have revamped our executive team. I started by bringing in Camille to act as the new CFO of the company, consolidating multiple functions underneath. We also brought Rabelo, Antonio Rabelo, as our new legal counsel. Rabelo has not only a deep knowledge of the company, but a very highlighted participation in all of the RJ process so far. Knows not only the company, but the process inside out.
We have also created a new executive leadership position, for which I brought in Mr. Daniel Hermeto , who used to be, in the past, the supply chain director and the wholesale director of Telecom Italia mobile team in Brazil. We just brought Mr. Hermeto to work with us in one of our key areas for cost reduction and structural simplification for the future. We continue to bring in new talent as we speak. We believe that the leadership of the company is now much more prepared for the future in terms of implementing the transformation plan that we announced in the middle of the year. Obviously, this will be a continuous process as we have announced that we are looking at an organizational simplification. I will provide you with relevant updates as soon as they are ready to be announced.
As far as your second question on the wireless rhythm and how far, how long can we sustain it? We believe, Samit, that because we are the player with the largest amount of fiber infrastructure in the country, and the fiber is a significant component of any mobile investment strategy going forward, our ability to sustain the good results from mobile goes a lot further than what people realize or people think, people believe. Because by controlling the transport infrastructure, we have control of one of the greatest components of a cost in a mobile strategy, which is the transport, the backhaul, and all of the associated cost of traffic. Also because it allows us to focus our access investments on mobile to the areas where they really matter for the company. Those areas are twofold.
The first one is where we do have significant market share to protect, and we are doing just that. We are expanding 4G and 4.5G in the areas where we have market share to protect, especially in certain parts of the northeast and the south of the country. At the same time, we can focus on being very aggressive commercially in areas where we do have a significant network capacity available because we have a less utilized network than the remainder of our peers. With that, we can be commercially aggressive. We can bring in new customers who will not cannibalize our existing customer base. At the same time, we can focus access investments on these areas selectively, to improve quality and to attract new customers on board. Our access has been focusing on refarming.
It's not necessarily on just completely brand-new sites because we do have infrastructure-sharing agreements with other players which help us complement our coverage infrastructure. As you know, we do have rent-sharing agreements both with TIM and with Vivo. As such, we have also been using very selectively our investments in access to focus where it matters. With all of that, we do believe that we can continue our very positive traction mobile results for the coming years. Obviously, we're doing that in a concerted effort with the commercial activity that goes to the postpaid segment, and thus the very good results that we have been able to present.
That's clear. Can I just ask a quick follow-up, please? Just jumping back to Angola a second. Can you confirm what was the USD amount of dividends you received, please?
It was informed in our quarterly reports that we were able to repatriate BRL 33 million, if I'm not mistaken here. I believe this is the official number that is reported in the reports.
Okay. Thanks. Sorry, I missed that. Thank you.
Mr. Carlos Sequeira from BTG Pactual would like to ask a question.
Hi, good morning, Rodrigo, Camille. How are you? My question is on the bridge loan that you mentioned in the presentation. Can you give us more color on I know you mentioned a firm commitment. My question is, so you have already secured $400 million out of the $600 million that you're planning to raise on this bridge loan. If you can give us some more information on that front, that would be great. Thank you.
Yes. We secured a $400 million firm commitment for the bridge loan. There's a very high probability that it will be applied to $600 million, which will comprise the 2.5. The idea is that we have this facility in place in case we don't think that the market conditions for the public debt agents are appropriate.
We do have a pending negotiation of final documents, of course, but we have a $400 million firm commitment for a bridge loan.
Just one more question. When do you expect the money to be in Oi? When do you expect to have the money to draw down?
We will be monitoring the market throughout December and early January. If you remember well, the 2.5 in our RJ plan has a drop that date, so we need to raise this money until early February. We will be monitoring the market throughout December and early January to check that capital markets conditions, and then we will make a decision whether to go ahead with our public offering or public debt offering, to be clear, or to draw the bridge loan. It's a term loan that can be prepaid in the short term.
Okay, perfect. Got it. Thank you very much.
Mr. Guido Rosas from Goldman Sachs would like to ask a question.
Thanks for the call and thanks for taking my question. I think just following up a little bit on the financing side, you mentioned some reversible assets that are pending approval to get sold. There was also towers being discussed. Can you maybe provide a little bit of color on that, on progress with selling towers, or if that's still something that's expected in the short term? Thank you.
Thank you, Guido. Well, when we talk about reversible assets, we talk about, in particular, about real estate units which are available for sale. Obviously, when we look at reversible assets and real estate at this point, a lot of things have changed because of the new telecom law and, the classification of reversible and non-reversible assets is a point that is being discussed by Anatel as we speak. We have already selected a handful of assets to be able to initiate sales processes immediately. Some of them already have the release from Anatel for us to be able to sell them. Some of them are in the process of having those releases granted to us.
The good part of the highlight is that when we look at our overall 8,000 pieces of real estate portfolio, when we focus on just a handful of assets, we're able to, in the very short term, be able to draw something such as BRL 250 million, BRL 300 million, BRL 350 million of sale of real estate assets. This does not include the BRL 120 million that we have virtually concluded and is now pending just the final release from Anatel. This would elevate the number in the short term to in the range of BRL 300 million-BRL 450 million of real estate sales. This is very positive because when people question our ability to sell 8,000 units of real estate assets, obviously, it's very hard to do that in the short term.
When we focus on just a handful of assets, we can see that out of the number that we have provided in the past of between BRL 1.5 billion and BRL 2 billion sales of real estate, we see that a quarter of that is concentrated on a very small number of assets, thus making the process a lot easier to execute.
Thank you. Yeah, one follow-up on that.
Yeah, on your second question about towers.
Yeah.
Obviously, the sale of towers is a much, much more standard process compared to all of the other non-core asset sales processes. What we have done is we have decided to wait for the conclusion of our due diligence of the portfolio of towers that we're selling. Now we have a firm set of results and information about the portfolio that we're concluding, what we're selling with the conclusion of a due diligence, which allows us to go for a process where we can extract a much, much higher value of this tower portfolio. We have launched the process already, and we expect this to be a fast process based on the traditional number of interested parties in the assets.
Perfect. Thanks very much.
Yeah.
The follow-up question that I had quickly here was just on the equipment, potential BRL 2 billion that could be raised as part of the RJ plan that is connected to the purchase of equipment. If you could provide a little bit more details on timing of that and when do you expect, or when do you plan to get that lined up?
Well, on the equipment, as you know, all telcos work with some form of vendor financing of sorts. In our case, because of the RJ process for the last two years, we have not done any transaction of this nature. As such, given that the company's going back to normality, we are again reopening. We have reopened the lines of conversation with all of our vendors, but not only with the vendors, but with other sources of finance, which are aimed at purchasing equipment. We have been having several of those conversations. We have obviously different stages of negotiation with different vendors and different providers of vendor financing. We expect that we would be able to tap this at the H1 of next year. Obviously, we'll provide more details as those negotiations progress.
Thank you.
Thank you.
Mr. Felipe Scheink from Credit Suisse would like to ask a question.
Good morning, everyone. Thank you for taking my question. My first question is regarding, if you could comment please a little bit on the strategic value of the mobile business for the company as a whole. We have been seeing the company focusing a lot on the fiber business, on the residential business. I'm just trying to understand what the company is seeing for the mobile business, given that it has been performing pretty well. Right. Is there any discussions regarding a potential sale of Oi mobile, and could you please comment a little bit on that? My second question is regarding on the cost front, on the provision for doubtful accounts. Okay. Should we expect any increase in the coming quarters or throughout 2020, given that you guys have been adding a lot of postpaid and control additions, right, in the mobile segment? Those are my two questions.
Thank you.
Thank you, Felipe. Well, starting with the value of the mobile business, as we have highlighted several times now, we believe that we have a very, very accretive mobile business, which has a significant market value. Obviously, as a recognition of that, we all have been seeing and listening to declarations of peers that in case this asset was eventually available for consolidation, they would be interested in looking at it. Given those formal declarations of our peers, we have decided, with the help of our financial advisor, to initiate a market sounding process. We are in the process of doing that with our financial advisors. The true nature of the value of the mobile business can be understood.
As such, we'll see and be able to measure how much the value of the mobile business has been recognized and is able to generate value for the shareholders going forward. In order to do that, as I mentioned, we are using our financial advisors. I'd like to highlight that there are still no formal discussions or any negotiation in place at this point. As far as the bad debt, well, there are two components to the bad debt here. I'll mention that the key one is how will our performance on fiber actually reflect on bad debt. Here when we substitute copper users, copper subscribers for fiber subscribers, we actually have a positive impact on bad debt. Our fiber subscribers have been presenting a much lower net bad debt than copper.
In particular, because we have been selective towards the areas where we have been obviously selling it. As far as the mobile postpaid, we have introduced in the recent quarters a lot of mechanisms, several mechanisms to actually allow us to better control bad debt as far as credit scoring goes. In the past, credit scoring was not as efficiently used. We have been fine-tuning our credit scoring capabilities to actually continue growing in postpaid without impacting bad debt, and the result so far is in line with what we expected. As such, with maintaining our mobile results in line with what we expected and using the fact that our fiber revenues will come with lower bad debts associated, we believe we will have good news to tell about bad debt in the future.
Perfect. Thank you very much.
Yeah. Just as a final remark, which I forgot to mention here, is that you also asked about the control plans. The control plans have no bad debt associated. They're almost fully prepaid. Okay?
Mr. Andre Baggio from JP Morgan would like to ask a question.
Hola, Rodrigo. I have a question with regards to EBITDA. The EBITDA this year has been very weak. I see it going down more than 20%. How can this trend be changed next year? I understand that you have a very interesting long-term plan with fiber and so on. How are we going to bridge this long-term positive outlook to a more short-term challenge outlook?
Thank you, Andre. Well, you're right. EBITDA has been pressed by the decline of the legacy businesses, in particular, those related to copper. Let's remember that it's expected that we do have a dip in our revenues associated with legacy, not only because of the structural trends, but also because we have invested and decided to invest, in particular in fiber, to transform the revenue components of the company. We are interrupted doing things such as proactive selling of very low quality, high churn, high bad debt areas with copper broadband, for instance. There is an associated initial impact on our revenues. Obviously, with reducing revenues while you're still not completely substituting that with fiber revenues, we do have an impact in EBITDA.
If you look at what is happening with the EBITDA components on the fiber business, this year, the EBITDA, the revenues, and obviously the EBITDA associated can be very small. We are just getting to the BRL 100 million mark, as we mentioned. When we look at next year, we see that we can expect a significant increase already of the fiber revenues, which come with a much better associated EBITDA level. Obviously, there is a trajectory to compensate for that in terms of pure revenues, and thus come the second part of the answer to your question, which are the structural initiatives for our cost reduction. When we look at the OpEx reductions that we had this quarter, they were probably smaller than in the past, because obviously when you're just doing across the board cost-cutting, you have decreasing returns as time goes by.
What we're doing is, we're adding on top of the normal cost reduction initiatives that any company has at any given time. We're adding the five structural components of cost reduction that Camille highlighted during the presentation. With that, we can expect to compensate part of the EBITDA and be able to be in a position to start growing EBITDA again, in a matter of a year and a half. Obviously, it is a significant challenge during the early period of the transformation plan. We know that, and that's the reason why we believe that the funding component is essential, because it help us sustain the investment which is required for the mid-term. We know we have a challenge in EBITDA during the first year of the plan. That is expected.
The significant growth of fiber associated also with the growth that is coming back to corporate, with B2B, and the growth that is coming back to wholesale on the unregulated revenues we have to compensate for.
Rodrigo, you talk about some legacy business, which is well-known, but in essence, taking aside the fiber, which other areas do you have EBITDA, which is at least more or less stable these days? Is mobile EBITDA also stable and maybe on what other areas today?
Well, mobile is stable, and will grow because it will obviously follow the path of revenues, and we're coming back to revenue growth in mobile. As such, with all of the initiatives of cost reduction, we expect EBITDA in mobile to continue growing as well. We have to remember that mobile has not been a cash consumer for us. It has been contributing positive results to the company. We have not greatly accelerated our CapEx and obviously associated OpEx, with the mobile front. We have been investing very selectively, as I have highlighted in a response to a previous question. With this, we expect our EBITDA for mobile to grow, even if not at a very accelerated pace, but to grow based on the return to growth on the mobile revenue as well.
Perfect. Thanks a lot.
Thank you.
Mr. Patrick Dyson from GoldenTree would like to ask a question.
Hey, good morning, Rodrigo, Camille. A few questions. Following up on the earlier one, Rodrigo, can you provide any more specificity around the specific timing on the CEO transition? There has been press reports that it may happen at the end of December or the end of January. Some specificity would be good there. Secondly, on the asset sales, I noticed that you raised the range on the asset sales to approximately BRL 8 billion from the strategic plan. Could you talk about the phasing on the asset sales in the context of towers, data centers, fibers, et cetera? How we should expect that? Two other questions. Obviously, a notable event that happened in the quarter was PLC 79. If you could just talk about your expectations around that. Final, just point of clarification on the dividends from Unitel.
Could you clarify that that was $33 million and that that was received in November? Thanks.
Thank you, Pat. Multiple questions there. Let's try to address them one by one. In respect to the timing of any transitions, as we have been highlighting, we are in the middle of a process to revamp the executive leadership of the company. When we have the new steps of this transition, we will obviously communicate them when appropriate to the market. We believe that the key focus at this time is really to have a complete management team in place to be able to help us execute the plan. We're almost there in having this completed. As I highlighted, we do have a new CFO, we have a new legal counsel, we have a new business support director.
Obviously, we continue to count with the core team that has brought the company here with a very good performance on the operations, on the commercial, on the wholesale front. We are almost there as far as completing what would be a core leadership team. Obviously, when we conclude this process, we will announce it immediately. On the asset sales, there is an associated timing with all of the assets which obviously go in parallel with the complexity of each of the sales processes.
We expect, again, going back to Angola, even though it's the more complex and the largest of all of the non-core asset sales, we expect it to be completed still this year because it's a process that has started a long time ago, and we have been communicating this to the market. We don't change any of that. The second one in terms of timing would be the towers. The towers should be a very fast process now that we have our tower due diligence fully completed. With such, we can move with great speed. We could expect the closing of towers with the proceeds coming to the company at the end of the Q1, give or take. The next one will be the sale of real estate.
In the sale of real estate, we have to understand that there's not any single one transaction that will bring all of the proceeds, but we have at least six real estate units which are up for sale that we expect will constitute the $300 million-$400 million number that we mentioned during the presentation. We expect those sales to occur as we go in the next several months. We would expect the process of this $300 million-$400 million to be concluded by the end of the H1 of next year. We have the data centers and the fibers. The data centers would be the next one to come, most likely in the H1 of next year as well. Obviously, we have the process in place. Several interested parties already looking at the process and the information that was put together.
Finally, we have the non-core fiber process. This will be the last one to go, most likely at the end of the H1, but still with some due diligence in place so we can completely finalize the structuring of the sale process. There are many different components of the asset sales. Obviously, the company expects to start giving good news as we go by in the next few months. Immediately, every time we have good news to present to the market, we're going to provide a formal communication about them. On your third question about PLC 79, you see that I have not talked at length about the PLC 79 approval during the quarterly results, because we believe it's a very positive impact, but which is not short-term.
We don't expect any super short-term impact of PLC 79 other than the one I mentioned when I was talking about real estate sales, because it's a lot easier to qualify real estate assets as non-reversible based on the approval of the new law. Apart from that, we know that there are still a number of steps to be taken as far as providing the regulation of the new law. This regulation can take somewhere between 12 and 18 months to be fully completed. Obviously, the full results of the migration from concession to authorization and all areas that need to be regulated will only start to produce results after that.
What we have been doing, and we have highlighted this as part of the initiatives in the presentation, is we have been very proactive in the regulatory fronts to try to anticipate some of those results as far as obligations on the legacy businesses, in particular the STFC, the fixed voice service business, which we believe don't make any sense anymore, even before the full regulation of the concession to authorization migration, PLC 79. There are several areas where we believe that by looking in detail at the existing regulation, which can be just reviewed and modified, if possible, by Anatel without any necessary correlation with the PLC 79.
We have been working to try to make that happen as soon as possible because we know that we are generating significant value with our strategy based on fiber and based on mobile and based on the growth of wholesale and the growth of the B2B segments. Obviously, we know that the legacy will continue to be an anchor in results for some time to come. Obviously all of our efforts, not only on the operational front, but also on the regulatory front, will be aimed at diminishing this impact as much as possible. We know that there's a lot of details, there's a lot of granular work to be done there, but obviously this will be a focus of our operation going forward, not only on the operational front, but also on the regulatory front. Finally, as far as the Unitel dividends that you mentioned, yes.
They are received in USD, outside of Angola, and they are readily available for the company to tap in.
That was received after the quarter, correct?
That was received after the quarter, yes. That's correct.
Okay, great. Thanks, Rodrigo.
Thank you, Patrick.
Miss Maria Tereza from Santander would like to ask a question.
Hi, thanks for the questions. Two questions from my side. On top of the vendor financing agreements that you are in talks, do you also consider deploying fiber through partnerships similar to what other players are doing? My second question would be on your views on the 5G auction. Consider that you might consider selling the mobile assets, but you still want to be a 5G enabler for the wholesale through your fiber. Would you favor regional license and that the auction should happen as soon as possible? What are your views on that? Super quick, is it fair to assume that you are ruling out any potential capital increase in the near term? Thank you very much, guys.
Thank you, Maria Tereza. Starting with the fiber partnerships, the possibility of fiber partnerships. Yes, you're right. As we highlighted in the slide about wholesale, we are starting an operation to allow for fiber partnerships in the form of franchise operations in the areas where we do have fiber, but which have not been prioritized by us to go directly to the end customer at the first years of the plan. As such, we are proposing a model of franchise operations where we would use the advantage of our fiber presence, in particular, the backbone and the data network and transport networks in the regions to be able to provide a model where we participate in the end-user revenue with the franchisees. Also, we provide a cost reduction to them in the form of making our infrastructure available.
This will add up to other two initiatives that we have in terms of fiber partnerships. The first one, it's not necessarily a partnership, but it is the work that the wholesale team will continue to do. We will expand in providing service to ISPs in areas where we will not operate directly and where we will emphasize our work as providers of infrastructure, not necessarily going directly to customers. There is a model which can work in some areas, but in a restricted number of areas, which is called neutral network or neutral fiber. This model is a model where in order to accelerate investments, you partner with some infrastructure companies which normally have financial investments to help accelerate the implementation of fiber infrastructure in the regions.
In our case, and as a parenthesis here, you may have seen and observed several announcements in this regard made by other operators, where there are partnerships being announced to construct fiber in regions where they are not present. The difference in our case is that we are present in most of the regions. For this model for us to make sense economically and also strategically, it has to be concentrated in areas where we have the least presence of our own infrastructure. Obviously those are the discussions that we have been having.
We expect to announce some agreements in the near future as well in this model, but with an emphasis on focusing on the areas where we have the best return because we have infrastructure in place and we will simply not substitute a financial investment for an operational investment because it doesn't make sense for us. As far as 5G, yes, we do look at the 5G as an opportunity for both a direct participation where we would be providing services as part of our mobile operation, as well as a provider of 5G infrastructure with the presence of fiber. We have included in our strategic plan the purchase of 5G licenses when they occur. Obviously, there's still a lot of discussion about when and how the 5G auction will be conducted.
We know that there are several still pending definitions as far as the nature of the auction, if the auction will be regionalized versus nationalized. What are the size of the spectrum blocks? What are the counterparts in terms of investment versus coverage, et cetera? The only way we can actually issue an opinion about our preferences is when we have a full understanding and a much clearer picture of where Anatel is going with the auction. We believe that given all the discussions in place, most likely, we will have a delay as compared to what was being said earlier about when the auction would take place. Initially, obviously, everybody was saying that it would take place at the H1 of next year. Now, most likely the discussion is will it occur at the end of next year or at the beginning of 2021?
We will be ready to operate in any of the two scenarios. As far as your last question.
The capital increase.
which was the capital increase. Yeah. Well, we have stated this before, given where our stock is trading, given all of the options that we are pursuing as far as debt financing and sale of non-core assets, at this point, we have initially ruled out the capital increase for the time being. Obviously, this is a tool that any company has to have in their toolkit if the timing and the conditions are appropriate. In our case, this is not the case at this point.
Perfect. Thank you very much, Rodrigo.
Thank you.
I would like to turn the floor over to the company for final remarks.
Okay. Thank you everybody again for participating in our call. We know that we are starting a long process. It's a long transformation journey. We believe that there are very significant opportunities ahead of us. We know that we have challenges in many different areas, but we are confident in our execution, as I have stated. We have a new, engaged, motivated team. We are showing the first signs of execution on the key fronts of the plan. We expect, as I mentioned, to start giving good news to the market in the coming months with the continuation of the execution of our plan. Obviously, we know that we are here for the long term and that we have to stay firm on our direction because only this direction will end up generating significant returns to shareholders. We feel confident on our execution.
We thank you for being with us for the earnings call. Obviously, we will be with you again with the results of Q4 when they become available. Thank you so much. Have a good day.
This concludes Oi S.A.'s conference call. We would like to thank you for your participation. Have a good day.