The board of Telecom Italia (TIM) met yesterday to consider a takeover proposal they say they received from investment firm Kohlberg Kravis Roberts & Co. L.P. (KKR). The bid, which was termed “non-binding and indicative,” contained an offer of 0.505 euros per ordinary and/or savings share, which media reports stated would make the company worth 10.8 billion euros ($12.2 billion), not including any debt assumption. The board did not indicate whether they planned to accept the proposal.
The board said that KKR termed the offer “friendly” and therefore seeks the approval of TIM’s directors and company’s management. The offer is conditional and subject to an estimated four-week period of due diligence as well as clearance by government stakeholders. The Italian government has the right to scuttle the deal because the company’s network is considered of national importance, TIM’s board noted.
Any purchase agreement also would be subject to acceptance by 51% of shareholders for both classes of shares. Observers expect major investor Vivendi to consider the KKR bid inadequate.
The bid for TIM is the latest example of foreign private capital seeking to enter the Italian telecommunications market. Macquarie of Australia recently saw their agreement to purchase a stake in wholesale broadband network operator Open Fiber approved by the European Commission (see “European Commission approves CDP/Macquarie takeover of Open Fiber”). This deal could pave the way for a tie up between TIM and Open Fiber as CDP, Macquarie’s partner in the Open Fiber purchase, also owns a stake in TIM.
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Stephen Hardy | Editorial Director and Associate Publisher, Lightwave
Stephen Hardy is editorial director and associate publisher of Lightwave and Broadband Technology Report, part of the Lighting & Technology Group at Endeavor Business Media. Stephen is responsible for establishing and executing editorial strategy across the both brands’ websites, email newsletters, events, and other information products. He has covered the fiber-optics space for more than 20 years, and communications and technology for more than 35 years. During his tenure, Lightwave has received awards from Folio: and the American Society of Business Press Editors (ASBPE) for editorial excellence. Prior to joining Lightwave in 1997, Stephen worked for Telecommunications magazine and the Journal of Electronic Defense.
Stephen has moderated panels at numerous events, including the Optica Executive Forum, ECOC, and SCTE Cable-Tec Expo. He also is program director for the Lightwave Innovation Reviews and the Diamond Technology Reviews.
He has written numerous articles in all aspects of optical communications and fiber-optic networks, including fiber to the home (FTTH), PON, optical components, DWDM, fiber cables, packet optical transport, optical transceivers, lasers, fiber optic testing, and more.
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