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The Canada Pension Plan Investments Board (CPP) will invest $2 billion for a 17.5% stake in the newly spun-off business
On Friday, the CPP announced that they would be the latest company to invest in the highly prized fixed network assets of Italian incumbent operator TIM.
The pension fund will invest roughly $2 billion for a 17.5% stake in the business, with the deal giving NetCo an enterprise value of $27.5 billion.
The deal sees CPP join a growing number of investors in TIM’s spun-off fixed networks unit, which includes all of the company’s fibre network assets but excludes the company’s submarine cable unit, Sparkle.
TIM announced plans to separate the unit last year as part of a new strategy under CEO Pietro Labriola seeking to better monetise the company’s assets. The announcement quickly drew interest from numrous major players, most notably US investment firm KKR, who would go on to to acquire the whole of NetCo for €18.8 billion at the end of last year.
Since then, various additional players have joined the growing consortium, including a wholly owned subsidiary of the Abu Dhabi Investment Authority, the Italian infrastructure fund F2i and the Italian Ministry of Economy and Finance.
For CPP, the stake represents the first step of their infrastructure investment strategy in Italy.
“Our investment alongside these key partners with a shared long-term vision will help deliver high-quality digital infrastructure across Italy as well as generating long-term risk-adjusted returns for the fund,” said James Bryce, a managing director and global head of infrastructure at CPP Investments. “We are optimistic that NetCo can represent the first of several infrastructure investments in Italy for CPP Investments.”
The deal is expected to close in the summer, subject to typical regulatory clearances.
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