Telecom Italia Confirms Talks with KKR on Fiber Network Development
February 28 2020 - 05:52AM
Dow Jones News
By Mauro Orru
Telecom Italia SpA said late on Thursday that investment firm
KKR & Co. Inc. submitted a non-binding offer to be its
exclusive partner in fiber network development.
The announcement comes as the Italian telecommunication company
continues to assess "possible forms of integration" between its own
and wholesale operator Open Fiber's optical fiber networks.
"We believe KKR's involvement might go beyond the pure fiber
infrastructures," said Thomas Coudry, analyst at European
investment bank Bryan Garnier, citing a Bloomberg report suggesting
that KKR submitted an expression of interest to acquire a 49% stake
in Telecom Italia's secondary network of copper and fiber lines. It
also suggested the two could partner to buy Open Fiber, which is a
50:50 joint venture between Enel SpA and Italian state lender Cassa
Depositi e Prestiti.
"We view the transaction as a significant catalyst for Telecom
Italia as it should significantly contribute in the group's
deleveraging, and also help crystallize the value of Telecom
Italia's infrastructure at a time when the group is being
challenged on the retail side," Mr. Coudry said, adding that
selling a 49% stake could reduce Telecom Italia's debt by more than
15%.
Write to Mauro Orru at mauro.orru@wsj.com; @MauroOrru94
(END) Dow Jones Newswires
February 28, 2020 05:37 ET (10:37 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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