A tie-up between Telecom Italia and Hutchison Whampoa’s 3 Italia could see the former acquire the latter and then issue new shares to allow the Hong Kong-based company to become one of its shareholders, Italian media have speculated.
Telecom Italia…
A tie-up between Telecom Italia and Hutchison Whampoa’s 3 Italia could see the former acquire the latter and then issue new shares to allow the Hong Kong-based company to become one of its shareholders, Italian media have speculated.
Telecom Italia confirmed late last week that it is in preliminary talks with Hutchison about a potential tie-up, however neither party has commented on the form such a deal would take.
Italian newspaper La Repubblica reported, without citing sources, that Hutchison could acquire new shares equal to a stake of up to 10% in the Italian incumbent, reducing holding company Telco’s stake from 22.4% to about 20%. Telco shareholders are Telefonica and several Italian financial institutions.
Meanwhile, Il Sol 24 Ore reported that Hutchison could acquire a stake of between 10% and 20% in the Telecom Italia via a share purchase deal.
The Telecom Italia board is set to meet on 11 April to discuss the matter.
In its short statement last week, the company declined to comment on the nature of the talks given they are at an “immature and preliminary” stage.
Telecom Italia’s relatively high debt level of €28bn at the end of 2012 has also prompted analysts to speculate that a deal would most likely be share-based.
