Telecom Italia postpones fixed-line sale as Italy’s regulator approves lower cost access for competitors

Telecom Italia SpA (BIT:TIT) said its board had decided to halt the implementation of the plan to spin off the fixed-line business until favourable regulatory conditions are in place.

Italy’s telecom regulator AGCOM provisionally approved last week lower charges for competitors to rent space on the operator’s fixed-line copper network.

Telecom Italia has said that such a move by the regulator puts the spin-off at risk. Slashing the fees would reduce the value of the fixed network and thus potentially lower the attractiveness of the new firm to investors, Reuters notes.

Reuters reported earlier, quoting a source in the know, that Telecom Italia might drop the spin-off plan in the wake of the regulatory development.

Telecom Italia’s board gave the green light to the spin-off in May. Under the plan, the separation will involve the creation of a new company that will hold the network and will be 100% owned by Telecom Italia.

Italian state-backed financing institution Cassa Depositi e Prestiti SpA (CDP) has been in discussions with Telecom Italia to acquire an interest in the new entity for months. The telecom operator’s chairman Franco Bernabe said in May the group could sell a minority stake in the network to CDP, while keeping a majority interest.

Hong Kong-based Hutchison to acquire 10% stake in Telecom Italia

Hutchison Whampoa Ltd (HKG:0013) is likely to acquire an up to 10% interest in Telecom Italia SpA (BIT:TIT) as part of a possible deal to combine its wireless unit H3G SpA with the Italian telecommunications group, daily La Repubblica reported.

The paper, which did not cite any sources, added that such a deal would dilute the stake of holding company Telco SpA, which currently owns 22.4% in Telecom Italia, to some 20%.

On Friday, Telecom Italia said that it was in preliminary talks with Hutchison Whampoa over a possible combination with H3G, also known as 3 Italia SpA, adding that its board would discuss the issue during its meeting on 11 April. H3G is valued between EUR1.5bn (USD1.9bn) and EUR2bn, Reuters said, citing analysts’ estimates.

According to a report by another Italian daily, Il Sole 24Ore, which quoted unnamed sources, a possible deal would be in cash and stock and would give Hutchison not more than 20% in Telecom Italia. Daily La Stampa said that the owners of Telco — Telefonica SA (MCE:TEF), Assicurazioni Generali SpA (BIT:G), Intesa Sanpaolo SpA (BIT:ISP) and Mediobanca Group (BIT:MB) — would be interested in such a transaction.

Reuters could not immediately contact Telecom Italia, as well as spokespersons for the Italian owners of Telco for comment. A spokesman for Telefonica refused to comment.

Telecom Italia in exclusive talks to sell La7 stake to Cairo Communications

Telecom Italia SpA (BIT:TIT) said its board had agreed to begin exclusive negotiations with media firm Cairo Communication SpA (BIT:CAI) about the sale of its entire stake in TV channel La7 Srl, part of the media unit Telecom Italia Media SpA (BIT:TME).

The talks will not concern the 51% stake held by La7 in the MTV Italia station, the vendor explained.

Telecom Italia had previously tried to sell its 77.7% stake in troubled Telecom Italia Media by the end of 2012 in a move to reduce debt and focus on its core operations. However, it failed to get attractive bids.

Diego Della Valle, chairman of Italian clothing and footwear conglomerate Tod’s SpA (BIT:TOD), said on Saturday that he had also submitted an offer for La7. The other suitor in the race for Telecom Italia Media assets was private equity investor Clessidra SGR SpA, which had offered to buy the entire media unit.