Apax Partners LLP and Bain Capital Partners LLC made a 7.075 billion-euro ($8.8 billion) joint offer for Oi SA’s Portuguese phone-carrier assets, starting a bidding war with billionaire Patrick Drahi’s Altice SA.

The two private-equity firms’ offer, disclosed by Oi today, is 50 million euros higher than Drahi’s (pictured). Each of the rival bids includes two sets of 400 million-euro deferred payments that depend on how the assets perform, and they exclude business in Africa and an investment in defaulted debt.

The bidders are seeking expansion in a market set to benefit from rising demand for Web downloads and video streaming as Europeans take advantage of faster data speeds. Portugal’s call and data prices are some of the lowest in Europe, which leaves less risk for further declines, said Guy Peddy, an analyst at Macquarie Bank Ltd. in London.

“Portugal is a very competitive market that has been through material price decreases,” Peddy said by phone. Oi’s Portugal business has completed a fiber-installation project, strengthening its cash flow, he said.

Proceeds from the sale would help Oi pare its $18 billion debt and take part in consolidating Latin America’s biggest telecommunications market. A successful bid by Altice or its rivals would also unwind Portugal Telecom SGPS and Oi’s yearlong merger that was marred by defaulted debt at a unit of Grupo Espirito Santo and a change of chief executive officer.

Altice shares fell 0.7 percent to 49.09 euros at 2:04 p.m. in Amsterdam. Oi, Brazil’s largest landline carrier, rose 1.5 percent to 1.36 reais in Sao Paulo.

Representatives from Altice and Apax declined to comment. Representatives for Boston-based Baincouldn’t immediately be reached for comment.

The private-equity firms’ offer was sent to Oi’s board, the Rio de Janeiro-based carrier said in a statement. Altice, investor Drahi’s Luxembourg-based cable holding company, made a 7.025 billion-euro bid for the Portuguese assets last week.

Both bids exclude the 897 million euros in short-term debt Espirito Santo’s Rioforte Investments SA has defaulted on and that was held by Portugal Telecom.

Portugal Telecom SGPS, the publicly-listed holding company that holds a minority stake in Oi, doesn’t have any operating control over the Portuguese assets, though it does have veto rights over a sale of them, according to two people familiar with the matter.

Altice will finance its bid with cash and debt, it said on Nov. 2. Oi didn’t say in its statement how Bainand Apax plan to fund their offer. The private-equity firms’ bid requires internal approvals and certain legal due diligence, according to the statement.

Altice intends to argue that it will make investments and preserve jobs in Portugal -- two issues local authorities are likely to be sensitive to -- to sway Oi’s opinion in its favor, a person familiar with the matter said this month. Portugal Telecom’s most recent annual report showed the company had about 7,500 telecommunications employees in the country.

Altice already owns cable assets Cabovisao and Oni in Portugal. Given that they aren’t phone operators, there shouldn’t be any regulatory obstacles for Altice acquiring Oi’s assets, Macquarie’s Peddy said.

Oi and Portugal Telecom agreed a year ago on the combination to create a carrier with 100 million customers to compete against Telefonica SA and Carlos Slim’s America Movil SAB. In July, the companies renegotiated the transaction to give Portugal Telecom a smaller stake in the combined entity after it emerged that the Lisbon-based partner was holding debt defaulted by Rioforte.

On Nov. 10, Isabel dos Santos, the daughter of Angola’s president, made a 1.2 billion-euro bid for Portugal Telecom SGPS.

--With assistance from Kiel Porter in London.

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