The Portuguese government has used its golden shares in Portugal Telecom to block the proposed sale of the company’s stake in Brazilian mobile operator Vivo to Telefonica. While a majority of the other shareholders at the extraordinary meeting voted in favour of accepting Telefonica’s sweetened bid of EUR 7.15 billion, the state used its 500 class A shares with special voting rights to block the deal. Holders of just under 70 percent of PT’s shares voted at the meeting, with 73.9 percent of those approving the sale. The Portuguese government is already facing a challenge from the European Commission over the golden shares, and the European Court of Justice is expected to rule in the next week over whether the extraordinary voting rights legal. Telefonica was barred from voting its shares in PT in the meeting, despite an attempt to sell the stake over the past week. Telefonica and Portugal Telecom each hold 50 percent in Brasilcel, the holding company that controls 60 percent of Vivo. Telefonica hopes to buy control of the mobile operator so it can merge Vivo with its fixed-line operations in Brazil.