The board of incumbent operator Telecom Italia (TI) is to further discuss a potential investment from Egyptian financier Naguib Sawiris next month.
At a board meeting on 6 December the directors will discuss the prospective capital injection from…
The board of incumbent operator Telecom Italia (TI) is to further discuss a potential investment from Egyptian financier Naguib Sawiris next month.
At a board meeting on 6 December the directors will discuss the prospective capital injection from Sawiris, according to a person briefed on the situation.
Sawiris’ potential investment is widely reported to be in the region of €3bn to €4bn.
An initial document from Sawiris, which expressed his interest in investing in TI, was read during a board meeting on 8 November.
On Monday TI said in a statement that Sawiris’ investment, which would be made via the issue of new shares, would potentially bring “new resources to the company to be dedicated to growth projects”.
A European sector banker cautioned that any investment by Sawiris might face political resistance in Italy. The banker said, referring to Carlos Slim’s failed attempt in 2007 to acquire a stake in TI, that a non-European investor might see political opposition to such a move.
TI’s CEO Marco Patuano confirmed yesterday that Brazilian telco GVT, owned by Vivendi, was “something to look at”.
The deadline for preliminary bids for GVT is reportedly at the end of the year. Alongside Telecom Italia US DTH broadcaster DirecTV has also confirmed its interest in GVT, while America Movil and Oi are both reportedly mulling bids Vivendi is said to be holding out for €7bn for its Brazilian subsidiary.
Four banks hired for network spin-off
TI has also confirmed the banks it has appointed for its long-mooted spin-off of its fixed-line network as it looks to further reduce its €29.5bn debt pile.
CEO Marco Patuano told reporters in Rome that TI has appointed Morgan Stanley, Intesa Sanpaulo, Mediobanca and Barclays to advise on the spin-off.
The disposal will also be discussed at the board meeting on 6 December.
In TI’s Q3 investor call chairman Franco Bernabe also conceded that details of a potential network spin-off would depend on upcoming new EU-regulation.
Neelie Kroes, the EU Commissioner for the digital agenda, is currently finalising new network guidelines.
The measures are intended to provide equivalent, non-discriminatory access for all operators, a recommendation on wholesale access costs and principles for when regulators can intervene.
On the call Bernabe said the spin-off of the network was “crucially dependant” on how the regulatory environment evolved and that also determine the timing of a potential disposal.
