# Telecom Italia boosted by rival offer for landline grid
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2023-03-06
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Telecom Italia Shares Rise 5% on Joint Bid from CDP and
Meta Description: TIM's shares rise as Italian state investor CDP and Australian fund Macquarie submit a joint bid for its grid, rivaling U.S. firm KKR.
URL: https://financedigest.com/telecom-italia-boosted-by-rival-offer-for-landline-gridhtml

![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2023-03-06t090806z2lynxmpej25074rtroptp4italy-broadband-telecom-italia-fibercop-1736814376966-compressed.jpg)

By Elvira Pollina

MILAN (Reuters) -Telecom Italia (TIM) shares rose as much as 5% on Monday after Italian state investor CDP and Australian fund Macquarie submitted a joint bid for the former phone monopoly’s grid, rivalling an approach by U.S. [firm KKR](https://www.financedigest.com/german-space-firm-ohb-plans-to-delist-as-kkr-takes-minority-stake.html "German space firm OHB plans to delist as KKR takes minority stake").

TIM is betting on a [sale of its most prized asset to cut its 25 billion euros debt](https://www.financedigest.com/european-junk-debt-sales-spring-back-to-life-as-sentiment-improves.html "European junk debt sales spring back to life as sentiment improves") pile and fund an overhaul of the revenue-starved group.

Both offers value TIM’s grid, which is [Italy’s main piece of telecoms](https://www.financedigest.com/telecom-italia-in-talks-with-unions-on-up-to-2000-job-cuts-in-italy.html "Telecom Italia in talks with unions on up to 2,000 job cuts in Italy") infrastructure, in the region of 18 billion euros ($19.2 billion), sources familiar with the matter said.

The news is positive for TIM as a second approach increases its bargaining [power,” broker Equita wrote in a research](https://www.financedigest.com/new-research-from-impact-com-shows-shifting-power-dynamic-that-puts-influencers-at-the-centre-of-the-brand-consumer-relationship.html "New Research from impact.com Shows Shifting Power Dynamic that Puts Influencers at the Centre of the Brand-Consumer Relationship") note.

The [shares were up around 3.5% at 0.32 euros](https://www.financedigest.com/mercedes-benz-to-buy-back-up-to-4-billion-euros-in-shares-by-2025.html "Mercedes-Benz to buy back up to 4 billion euros in shares by 2025") at 0900 GMT, levels not seen since last April.

The government of Prime Minister Giorgia Meloni has repeatedly said it wants to win control of TIM’s [network while protecting](https://www.financedigest.com/emergency-call-services-telcos-urge-eu-to-protect-telecoms-networks-from-power-cuts.html "Emergency call services, telcos urge EU to protect telecoms networks from power cuts") jobs, but there is no common ground within the administration on how to reach that goal.

[Regulation issues remain](https://www.financedigest.com/survey-finds-regulation-remains-top-financial-services-priority-for-2017.html "Survey finds Regulation Remains Top Financial Services Priority for 2017") a hurdle for the new bidders, as CDP and Macquarie own TIM’smaller rival Open Fiber. CDP owns also a 10% stake in TIM.

In its approach for TIM’s grid, KKR, which already owns a minority stake in the former phone monopoly’s network, left the [door open](https://www.financedigest.com/lack-of-electric-vans-opens-door-for-chinese-other-ev-makers.html "Lack of electric vans opens door for Chinese, other EV makers") to involving a state-run entity, but it opposes CDP playing such a role due to antitrust issues.

Both bids are below the 31 billion euro price tag sought by TIM’s [top investor](https://www.financedigest.com/top-ten-biggest-mistakes-by-novice-investors-and-how-to-avoid-them.html "TOP TEN BIGGEST MISTAKES BY NOVICE INVESTORS – AND HOW TO AVOID THEM") Vivendi, whose support is key for any deal to go through.

Assessing KKR’s approach, which rises to 20 billion euros when including an earnout mechanism, TIM said last month the fund proposal “does not fully reflect” the value of its asset and added it would [seek an improved offer by the end](https://www.financedigest.com/exclusive-nissan-seeks-tech-tie-up-without-renault-as-alliance-nears-end-of-road.html "Exclusive-Nissan seeks tech tie-up without Renault as alliance nears end of road") of this month.

($1 = 0.9398 euros)

(Reporting by Elvira Pollina; Additional reporting by Giancarlo Navach; Editing by Valentina Za and Keith Weir)


---
This blog is powered by Superblog. Visit https://superblog.ai to know more.
---