Pressure on Telecom Italia to sell its fixed line network is increasing, following remarks by key TI shareholder Marco Fossati.
According to a Bloomberg report Fossati, who controls around 5% in TI via Findim Group, has called on the incumbent to spin…
Pressure on Telecom Italia to sell its fixed line network is increasing, following remarks by key TI shareholder Marco Fossati.
According to a Bloomberg report Fossati, who controls around 5% in TI via Findim Group, has called on the incumbent to spin off the fixed line assets.
Fossati said the right time for a sale was now or within the next few months.
Telecom Italia has launched a number of asset sales this year in an attempt to reduce its debt. The telco sold internet unit Matrix for €88m in early August, and the divestment process for Telecom Italia Media is ongoing, with first round bids due today (24 September).
It had been suggested repeatedly over the past months that Telecom Italia could also spin off its fixed line network, valued at between €12bn and €15bn. The creation of a new venture with state lender Cassa Depositi & Prestiti (CdP) is seen as the most likely scenario. Counterpart Metroweb, which is controlled by CdP, could also take a stake in the venture.
Although TI has in the meantime announced intentions to build fibre networks together with Swisscom-owned Fastweb in some regions in Italy, TI CEO Franco Bernabe said days ago that the company would decide soon about a spin-off of its fixed line network.
TI COO Marco Patuano recently confirmed an ongoing “dialogue” with CdP over a networks venture. And CEO Bernabe said, speaking at an event organised by Bernstein Research last week, that there were more advantages than potential risks from outside investment into the network.
Bernstein analysts believe that in light of the recent agreement with Fastweb a full-scale structural separation of the network assets has become less likely. Instead, chances for a partial investment into TI’s network had increased.
“The current most discussed version includes the injection of ~€3bn of capital into TI’s network for a 30% stake in that asset,” the analysts said.
At the end of H1/2012, Telecom Italia reported net debt of €30.36bn and revenues of €14.79bn. The former incumbent’s largest shareholder is Telco S.p.A. with a 22.4% stake, which in turn is owned by Telefonica, Generali Group, Intesa Sanpaolo, and Mediobanca.
Marco Fossati’s Findim Group is the second largest shareholder, owning 4.98% of TI shares.
