Telecom Italia (TI) has suspended plans to spin off its fixed-line network into a separate company until changes to national telecoms regulations become clear.
The board of directors of the Italian incumbent met yesterday to examine the effects of…
Telecom Italia (TI) has suspended plans to spin off its fixed-line network into a separate company until changes to national telecoms regulations become clear.
The board of directors of the Italian incumbent met yesterday to examine the effects of communications regulator Agcom’s recent decisions to do with the spinoff plan, which involves assets said to be worth about €14bn (US$18bn).
Subsequently, the company issued a statement saying: “While reiterating the importance of the plan for both TI and the development of the country’s telecommunications system, the board acknowledged that the uncertainties introduced by recent decisions taken by Agcom might affect its feasibility”.
Last week, Agcom proposed a reduction to the rates rival operators must pay TI to access its fixed-line network.
Today, Vodafone Italia, VimpelCom’s Wind and Swisscom’s Fastweb issued a joint statement expressing their surprise at TI’s decision to halt the spinoff plan until regulatory changes are ascertained.
Saying Agcom acted in line with regulations when proposing the rate cuts, the three operators speculated whether the spinoff plan “wasn’t really just a way to put improper pressure on the regulator”.
TI announced in May that spinoff plan would see the new company own the assets and resources for managing and developing the passive access network (both copper and fibre) and the active components of the fibre network, reportedly valued at up to €14bn (US$18.16bn). TI has said the new structure would guarantee all licensed operators access to the fixed-line network in line with the equivalence of input model.
TI is said to hope the plan will better enable it to compete in the local market where it abides by stricter rules than rivals given it owns the fixed-line network.
The spinoff is the second major potential deal the telco’s board has stalled or halted this month. In early July, the company decided not to pursue a tie-up with Hong Kong’s Hutchison Whampoa.
