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TIM makes non-binding offer to buy BT Italia

BT Italia.jpg

Telecom Italia – now known as TIM – has offered to buy BT’s scandal-hit Italian operation, Capacity understands.

Bas Burger, CEO of BT Global Services, said in 2018 in an interview with Capacity that selling BT Italia was “one of the options” after the company wrote off £530 million following what the group called “inappropriate behaviour” in the unit.

The Times newspaper in London reported in June 2018 that BT had appointed Credit Suisse to find a new owner for BT Italia. The Bloomberg news agency said yesterday that TIM and other Italian operators were exploring bids.

Now Capacity understands that TIM has presented a non-binding offer to BT to take over the Milan-based company, though Capacity has not been able to establish what price TIM has offered.

Bloomberg reported that BT Italia had revenue of about €390 million euros in BT’s financial year 2017-18 and negative EBITDA.

Spokespeople for both BT and Retelit, another company said by Bloomberg to be interested, both refused to comment. “All we can say is that we don’t comment on rumour or speculation,” said BT. Retelit said: “At [the] moment we can’t comment [on] this kind of news.”

Federico Protto, CEO of Retelit, told Capacity in May 2018 that the company was looking for acquisitions – though his focus was expansion into Asian markets such as Singapore and Hong Kong rather than business in Italy.

Retelit has a market cap of €236 million and a quarterly revenue of just €15 million, so it probably too small to bid for BT Italia.

BT Italia mainly focuses on corporate clients. In his interview in 2018, Burger said that “no countries will be discontinued” from the company’s operations. “We have the option of selling assets, but we will not sell countries. We will mainly focus on fewer areas and on becoming more effective.” 

Meanwhile a TIM board meeting has decided to hold a shareholders’ meeting on 29 March – much later than requested by Vivendi, the French media company that is the largest single shareholder in the group.

Vivendi said this was “contrary to the company’s by-laws and the Italian Civil Code”, and added: “These time-wasting tactics are negatively impacting TIM’s financial results every day.”

It said that TIM’s share price has dropped by “more than 40%” since a US private equity company, Elliott, took control of the board in May 2018. “These tactics constitute a genuine denial of shareholder democracy and run counter to the most basic and fundamental principles of good corporate governance,” said Vivendi.

TIM said the shareholders’ meeting on 29 March would also “review of the financial statements for the year to 31 December 2018 and the remuneration report”. This would “ensure that the shareholders have a proper and adequate information set”.

Draft financial statements should be available on 21 February, said TIM.