Telecom Italia (TI) has sold its 22.7% stake in Telecom Argentina to US investor Fintech Group for US$960m.
The firm will pay US$859.5m upfront for TI’s stake, which is split between subsidiaries Telecom Italia International, Sofora…
Telecom Italia (TI) has sold its 22.7% stake in Telecom Argentina to US investor Fintech Group for US$960m.
The firm will pay US$859.5m upfront for TI’s stake, which is split between subsidiaries Telecom Italia International, Sofora Telecomunicaciones, Nortel Inversora and Tierra Argentea.
Fintech will pay a further US$100.5m, providing TI fulfils certain agreements to provide Telecom Argentina with services and technical support for the next three years, and subject to other conditions.
Fintech – the vehicle of Mexican investor David Martinez – also plans to launch a tender offer for the remaining shares in Telecom Argentina.
The investor holds a significant amount of Argentina’s sovereign debt and has a stake in local cableco Cablevision.
TI received an unsolicited bid for its stake in the Argentinian operator last week when it announced plans to raise €4bn (US$5.3bn) through a €1.3bn convertible bond issue and asset sales.
The Italian incumbent’s board authorised a sale as it looks to address its debt pile, which stood at €28.23bn at the end of September.
Yesterday, TI’s offices were raided by securities market regulator Consob and financial police in connection with the planned disposals and bond offering, as well as policies and procedures on confidential information.
Telecom Argentina reported revenues of €3.8bn in 2012 with an EBITDA margin of 29.6%.
TI looks set to keep its other Latin American business for now. CEO Marco Patuano has said that it plans to hold on to its majority stake in TIM Brasil, describing the asset as “core”. However some of its towers may be sold.
TI’s Latin American operators present antitrust issues for Spain’s Telefonica, which is looking to take over the incumbent’s controlling shareholder group Telco.
The Madrid-based telco has operations in Argentina and Brazil too, through Movistar and Vivo respectively.
