By Manuela Mesco
MILAN--Italy's largest telecom operator Telecom Italia SpA
(TIT.MI, TI) has received two binding offers for its broadcasting
unit Telecom Italia Media SpA (TME.MI), a person familiar with the
matter said Tuesday.
One of the two offers came from Cairo Communications SpA
(CAI.MI), which also manages advertising for La7 TV channels.
The second offer comes from Italian private-equity fund
Clessidra, which has made its bid together with another Italian
fund called Equinox, Equinox's Chairman Salvatore Mancuso said,
according to MF-Dow Jones.
Another person familiar with the situation said that interest
from other prospective bidders, including Discovery Channel,
dissolved because of difficulties related to the operation.
The person added that such difficulties are still unresolved and
include an ongoing contract with advertising company Cairo
Communications. The contract is said not to be favorable to the
broadcasting firm and hard to break. The person could not say how
long the contract would be in place, but argued that the success of
Telecom Italia Media's sale could strongly depend on whether a
solution can be found.
The person familiar with the matter also said that the large
number of employees at the loss-making broadcasting unit also
represents a problem for perspective buyers.
Telecom Italia Media, which operates La7 and Mtv TV channels,
was put up for sale earlier this year. But Telecom Italia's Chief
Executive Franco Bernabe previously said that he wouldn't want to
sell its 77% stake on any condition, hinting that a cheap price
could convince the controlling company not to go ahead with the
deal.
Telecom Italia had a net debt of EUR29.48 billion ($38.56
billion) as of Sept. 30, which should be reduced to EUR27.5 billion
by the end of the year, and the sale of its broadcasting unit was
expected to help reach the target.
The company is slated to discuss the offers at a board meeting
Thursday, together with plans to spin-off its fixed-line copper
network and the proposal received by Egyptian businessmen Naguib
Sawiris to invest in Italy's telecom operator.
Write to Manuela Mesco at manuela.mesco@dowjones.com.
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