Iliad heads race to take spare assets to set up Italian operator

Xavier Niel’s Iliad – which owns low-price French operator Free Mobile – is poised to set up in Italy after it was picked by Hutchison and VimpelCom to take over spare infrastructure and spectrum if they are allowed to merge.

Iliad, which has no Italian business at the moment, and Italian broadband operator Fastweb, owned by Swisscom, were both talking to CK Hutchison and VimpelCom, who want to merge their Three and Wind mobile businesses in Italy.

Agency reports say that Iliad has won this stage of the race to emerge as preferred bidder, but the whole proposal needs to be vetted by the European Commission, as both Hutchison and VimpelCom have operations in more than one European Union country.

The Commission has moved against mergers in European markets that reduce the number of mobile competitors from four to three.

Telecom Italia and Vodafone are the biggest mobile operators in Italy, and the two smaller companies see a merger as giving them a stronger role in the market.

According to one report, the Commission could give its decision by the end of next week.

A deal with Hutchison and VimpelCom would give Iliad its biggest expansion opportunity since it bought Orange Switzerland – now called Salt – from the Orange group in 2014 for €2.3 billion. Iliad also owns Monaco Telecom, which it bought for €322 million in the same year from Cable & Wireless Communications.