By Francesca Landini and Elvira Pollina
TRENTO, Italy (Reuters) – Telecom Italia (TIM) will pursue a plan to separate its fixed network from its service operations to maximize asset value for all its shareholders and reduce debt, the chief executive said on Sunday. largest Italian telecommunications company.
Under pressure for years in its fiercely competitive home market, the former Italian telephone monopoly is seeking to reorganize its business through a complete separation of its domestic fixed network assets to focus on retail and commercial activities.
In a preliminary pact sealed with Italian state lender CDP last week, TIM’s network assets would be combined with those of state-backed broadband rival Open Fiber to create a single network company. national under state control.
But Telecom Italia’s main investor Vivendi, whose backing is essential to getting any deal done, said it would be ready to assess other opportunities if the value of the network is not recognized in the broadband plan. unique.
“The most important thing is to maximize the value of all assets for the benefit of all shareholders,” Telecom CEO Pietro Labriola said in response to a question about whether Vivendi’s position could hinder the project.
CDP, which is TIM’s second largest investor with a 10% stake, also owns 60% of Open Fiber.
Speaking at an economic event in Trento, northern Italy, Labriola declined to say whether TIM was considering a full exit from its fixed network business with an outright sale.
He pointed out that any split would be designed to reduce TIM’s 23 billion euro ($24.65 billion) net debt.
“It seems to me that all parties (involved in the single network project) are interested in understanding fairly quickly whether the plan is feasible,” Labriola said, adding that the creation of a single fiber network could be completed in 12 at 18 months.
A veteran of the telecoms sector, Labriola, who took over the reins of the company in January, is due to present a three-year business plan on July 7 focusing on the break-up of TIM’s activities.
($1 = 0.9330 euros)
(Reporting by Francesca Landini, Elvira Pollina; Editing by Catherine Evans and Jane Merriman)