TIM enters exclusive talks with KKR over sale of NetCo

Italy’s biggest telecommunications services provider Telecom Italia (TIM) has announced exclusive negotiations for the sale of fixed-line network assets including FiberCop and Sparkle – which are to be merged into a soon-to-be established company are underway with KKR.

TIM’s Board of Directors deemed that the approximately €23 billion offer submitted by KKR was preferable in terms of “executability and timing” and was a higher bid than the competing offer submitted by CDP Equity and Macquarie Infrastructure and Real Assets (Europe) Limited.

The board has since given approval to the chief executive officer Pietro Labriola to initiate, on an exclusive basis, an ameliorative negotiation with KKR and reach an agreement by the 30 September.

The company revealed extensive and in-depth discussions have been conducted with the assistance of leading financial advisors including Goldman Sachs, Mediobanca – Banca di Credito Finanziario and Vitale & Co.

KKR an investor in TIM, was brought into the fold in 2020 by Gubitosi, who agreed a €1.8 billion deal for a 37.5% stake in TIM-owned FiberCop.

TIM previously rejected KKR’s bid of $10.8 billion in 2021, despite the company having financial difficulties, after facing lower-than-expected annual results and profits warnings within three months.

TIM noted any transaction involving the divestment of NetCo remains subject to obtaining legal authorisations, including those pertaining to the Golden Power process and Antitrust authorisations.