KKR ready to veto any plan by Telecom Italia to cut network – paper

MILAN, Feb 19 (Reuters) – KKR (KKR.N) could block any move by Telecom Italia (TIM) to set up a network company by vetoing the transfer of last-mile fixed telephony unit FiberCop, reported Saturday La Stampa.

The US investment fund, which owns 37.5% of FiberCop, launched a 10.8 billion euro ($12.2 billion) bid for Telecom Italia (TLIT.MI) last year but did not has not yet received an official response and is getting impatient, according to the Italian daily.

The fund does not intend to allow FiberCop to be integrated into a network company, the newspaper said, citing financial sources.

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KKR and TIM declined to comment.

The new management team of indebted TIM is working on a new plan which could envisage transferring the network assets of the former telephone monopoly into a NetCo vehicle and separating it from its services activities.

The revamp would be an alternative to KKR’s proposed takeover and could pave the way for NetCo to merge with its smaller rival Open Fiber to create a national fast fiber network champion, sources said.

State lender Cassa Depositi e Prestiti (CDP), which owns about 10% of TIM, controls 60% of Open Fiber, with the rest in the hands of Australian investment fund Macquarie.

“This decision would open up new scenarios (but) would not be so surprising given TIM’s reluctance to accept the offer,” Italian broker Banca Akros said on Saturday.

($1 = 0.8833 euros)

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Reporting by Stephen Jewkes and Elvira Pollina; Editing by Mike Harrison

Our standards: The Thomson Reuters Trust Principles.

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