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The Italian government has approved a stake swap that will see Poste Italiane take control of the 9.8% stake in TIM currently held by Cassa Depositi e Prestiti (CDP)
The ownership of Italy’s incumbent network operator Telecom Italia (TIM) continues to be a hot topic this week, with the Italian government agreeing to a stake swap between national postal service Poste and state lender CDP.
The swap will see Poste take control of CDP’s 9.8% stake in TIM, in exchange for the Poste’s 3.78% stake in Italian payments group Nexi and an undisclosed cash sum.
While the financial details of the deal were not released, the stake in TIM is worth roughly €440 million, based on TIM’s closing share price on Friday. It also makes Poste TIM’s second largest investor, after French media group Vivendi.
Poste expects the deal to allow for greater synergies for its Post Mobile service – the country’s largest mobile virtual network – while also potentially opening the door for its payments service Postepay to be integrated with the mobile network.
“The transaction represents a strategic investment for Poste Italiane aimed at creating synergies between the companies and supporting, together with all relevant stakeholders, the consolidation of the Italian telecommunications market,” said Poste in a statement.
But beyond these purported synergies, perhaps the largest factor in this stake swap is to help consolidate control of TIM in the hands in Italian companies.
TIM has increasingly been targeted by foreign investors in recent months, with the sale of the company’s networking assets (i.e., ‘NetCo’) to KKR doing little to quell M&A discussions.
Earlier this month, France’s Iliad Group, which owns TIM’s rival Iliad Italia, said it had returned to the negotiating table with TIM regarding a potential tie-up, with a potential merger bringing long-needed consolidation to the sector.
Iliad is not alone in showing interest in TIM, however, with private equity firm CVC Capital Partners also having alerted the government over its intention to approach TIM.
Such discussions are likely to have set alarm bells ringing for Georgia Meloni’s government, which has sought to retain closer control over companies like TIM that it seems to be ‘national champions’.
According to sources, the government has indicated that it would not support a deal that would see a foreign investor control TIM’s strategic direction and would be willing to exerts its ‘golden powers’ to veto such a deal if necessary.
As such, Poste, with its natural synergies with TIM, is deemed to be a more suitable stakeholder than CDP.
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