Regulator blocks Fintech's bid for Telecom Italia unit
Argentina’s telecoms regulator has rejected a $960 million sale of Telecom Italia’s stake in Telecom Argentina to investment firm Fintech.
The regulator said that Fintech was not in a position to operate and take control of Telecom Argentina.
"The board ruled that Fintech is not in a position to operate and manage the services and infrastructure of Telecom Argentina. Fintech has demonstrated neither experience nor expertise," said Argentina's Autoridad Federal de las Tecnologías de la Información y las Comunicaciones (AFTIC).
The regulatory board unanimously blocked the sale of 68% of Sofora Telecomunicaciones, Telecom Argentina's holding company, to the investment firm.
Telecom Italia agreed in November 2013 to sell its majority stake in Sofora for $960 million, including shares, held by various subsidiaries in Telecom Italia to Fintech. However the deal was delayed repeatedly for regulatory reasons.
In October 2014, Telecom Italia sold a 17% stake in Sofora to Fintech for $215.7 million while the remaining 51% stake was to be sold upon receiving approval of the regulator.
The companies have until the end of April 2017 to complete the sale. Failing that, Telecom Italia has a six-month option to purchase the 17% it sold and sell its remaining 51% stake.
"The contract provides for ample time and guarantees regarding completion of the sale of the stake in Telecom Argentina," said Telecom Italia.
"The purchaser, Fintech, has indicated to Telecom Italia that it plans to appeal the decision," it added.