Deadline for offer pushed back to November 30
Telecom Italia (TIM) has extended the original deadline for a bid on its network. The three way pact led by Italian national investment bank Cassa Depositi e Prestiti (CDP) now has until November 30 to submit a non-binding offer for the former monopoly’s landline grid, Reuters has reported. Talks between TIM, Italy’s biggest telecoms group, and CDP will continue on a non-exclusive basis.
CDP and its partners, fibre optic firm Open Fiber and infrastructure fund Macquarie, had asked for more time to negotiate a deal to buy TIM’s network assets, seeking to extend an initial deadline that ran out at the end of October for a binding agreement. TIM’s top investor Vivendi had some reservations about continuing exclusive talks with CDP on the network sale.
The potential multi-billion euro bid is part of a long-held plan to combine TIM’s fixed network assets with those of smaller rival Open Fiber to create a unified broadband operator under CDP’s control. The state-owned CDP holds a 10% stake in TIM and controls Open Fiber.
As reported in Mobile Europe the grid sale is also a key plank of TIM CEO Pietro Labriola’s strategy to turn around the debt-laden former phone monopoly. The initial timeline for a non-binding bid has been subject to multiple delays and was further complicated by a snap national election last month. Differences over valuations have also been a stumbling block in negotiations, with Vivendi seeking €31 billion ($30.89 billion) to back a deal, which is at least €10 billion above CDP’s valuation. Analysts say removing the exclusivity granted to CDP and partners could allow rival bidders to enter the fray and drive up the price.
The Brothers of Italy party, which leads the new Italian coalition government, backs the creation of a wholesale-only unified network operator. In her inaugural speech to Parliament, new Prime Minister Giorgia Meloni vowed to ensure national strategic networks were state-owned while enabling telecoms companies to compete on services. Meloni’s administration has special anti-takeover powers to shield companies deemed of strategic importance from foreign interest. It could use these to stop any deal for TIM’s network.