Fibre future

1 Sep 2020 By Lisa Jucca Follow @LJucca

Selling a chunk of its grid to KKR for 1.8 bln euros should help the operator fund investment in faster connections. Other indebted European telcos may follow. But a messy merger with state-backed rival Open Fiber risks choking competition and stalling Italy’s broadband upgrade.

This content is for Subscribers only

Context News

Telecom Italia’s board on Aug. 31 accepted a 1.8 billion euro offer from U.S. investment firm KKR for a 37.5% stake in FiberCop, which operates the Italian group’s last-mile network.

KKR’s offer gives FiberCop an enterprise value of approximately 7.7 billion euros, of which about 3 billion euros is debt. Swisscom-controlled Fastweb will swap its 20% of joint venture FlashFiber for a 4.5% stake in FiberCop.

Telecom Italia’s board also gave the green light to the signing of a letter of intent to merge FiberCop with rival Open Fiber, which is backed by state investor Cassa Depositi e Prestiti (CDP). The deal would create a single national broadband network, of which Telecom Italia would own at least 50.1%.

French media group Vivendi is Telecom Italia’s top shareholder with a 24% stake, followed by state investor CDP with 9% and U.S. investment fund Elliott Management with 7%. Open Fiber’s ownership is split between CDP and utility Enel, which in turn is 24%-owned by the Italian state.

Infrastructure fund Macquarie is preparing a binding offer for Enel’s 50% stake in Open Fiber that values the whole company at 7.7 billion euros including debt, Italian daily Il Sole 24 Ore reported on Aug. 28.

Context News

Telecom Italia’s board on Aug. 31 accepted a 1.8 billion euro offer from U.S. investment firm KKR for a 37.5% stake in FiberCop, which operates the Italian group’s last-mile network.

Email a friend

Please complete the form below.

Required fields *