Telecom Italia will meet on Sunday to evaluate the takeover offer from the US private equity group KKR. This is one of the biggest telecommunications acquisitions in history.
KKR already owns a 37.5% stake in Telecom Italia’s “last mile” network, but has moved to offer a full offer to the entire company, according to three people who know the situation directly.
The offer to the Italian group, which is worth € 7.5 billion and has a total debt of € 29 billion, is the latest sign of interest in private equity in the European telecommunications sector. The fund aims to split the business, separate the network from the consumer business, realize value or improve the performance of the company.
Telecom Italia Bitter tug of war Due to a four-year-old control between French investor Vivendi and US activist fund Elliott Management, it struggled in the last quarter and issued two profit warnings over the past year.
Equities have fallen one-third since March and two-thirds since 2018, putting pressure on Italian founder Luigi Gubitosi. Appointed Chief Executive Officer in 2018, Turn the company around.
The bid news was first reported by Corriere della Serra.
Vivendi has denied discussing the possibility of a private take from KKR, CVC, or Telecom Italia, as reported, with other agencies.
“Vivendi is a long-term shareholder and hopes to work with the government and other agencies to get Telecom Italia back on track,” the company said. “We are not happy with the performance … The important thing is to prevent this ship from going down.”
Telecom Italia was Europe’s most valuable telecommunications company in the 1990s, but has plummeted from crisis to crisis over the last two decades. It is a politically important company, and the government has the “golden power” to prevent acquisitions and asset sales that are not considered national interests.
KKR is one of the most active investors in the European telecommunications industry. It was part of a private equity group consortium that bought a minority stake in Telecom Italia’s secondary network through its infrastructure sector for € 1.8 billion last year and made Spanish carrier MasMovil private in a € 5 billion transaction last year. In 2019, we acquired Hyperoptic, a full fiber company in the United Kingdom.
The US acquisition group had previously offered an acquisition to Dutch telecommunications provider KPN, but this year it was rejected with a different approach than EQT and Stonepeak Infrastructure Partners. Both moves were one of the largest private equity acquisition attempts in European history.
Additional report by Sarah White in Paris
KKR makes buyout offer for Telecom Italia Source link KKR makes buyout offer for Telecom Italia
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