Sawiris con­sid­ers $2bn in­vest­ment in Tele­com Italia: source

Daily Trust - - REUTERS -

- Egyp­tian bil­lion­aire Naguib Sawiris wants to in­vest up to $2 bil­lion in Tele­com Italia if its big­gest share­holder Tele­fon­ica pulls out of the Ital­ian group, a source fa­mil­iar with the mat­ter said yes­ter­day.

Sawiris made an un­suc­cess­ful at­tempt to buy a stake in Tele­com Italia in 2012 and said the com­pany needed cash for in­vest­ments.

The source con­firmed a re­port in Sun­day’s Il Sole 24 Ore news­pa­per that Sawiris is in­ter­ested in mak­ing a fresh bid but said that an im­mi­nent ap­proach is un­likely.

“I don’t ex­pect things to move in the short term,” the source said. “Tele­com Italia still looks too ex­pen­sive for Naguib.”

Sawiris has also been crit­i­cal of the in­volve­ment of Spain’s Tele­fon­ica in Tele­com Italia be­cause of con­flict­ing in­ter­ests in Brazil. Tele­fon­ica, to­gether with three Ital­ian fi­nan­cial in­sti­tu­tions, con­trols 22.4 per­cent of Tele­com Italia through hold­ing com­pany Telco [TELCS.UL] and is a di­rect ri­val of Tele­com Italia in Brazil through its own­er­ship of mar­ket-leading mo­bile op­er­a­tor Vivo.

Sources close to Tele­fon­ica have said the group would like to break up Tele­com Italia’s Brazil­ian busi­ness TIM Brasil, while the Brazil­ian com­pe­ti­tion watch­dog has given Tele­fon­ica un­til mid-2015 to re­duce its pres­ence in the coun­try, other sources have said. If Tele­fon­ica fails to en­gi­neer a break-up of TIM Brasil it might have to con­sider sell­ing its 15 per­cent stake in Tele­com Italia to com­ply with the Brazil­ian author­ity’s de­mands.

Tele­fon­ica’ Ital­ian part­ners have sig­nalled that they could break up Telco in the com­ing months and even­tu­ally sell their stakes in Tele­com Italia, weak­en­ing the Span­ish group’s grip on the Ital­ian com­pany.

Tele­com Italia, which is due to ap­point a new board next week, is car­ry­ing out a 4 bil­lion euro ($5.56 bil­lion) plan to cut debt and fund in­vest­ments as it seeks to re­verse years of slug­gish growth.

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