Telefonica raises stake in Telecom Italia
MILAN: Spain’s Telefonica SA has reached a deal to raise its stake in the shareholding pact that controls Telecom Italia SpA, increasing its grip on the beleaguered Italian phone company.
The Spanish giant, which currently owns 46% of holding company Telco SpA, has agreed to pay a starting sum of
324 million ($437 million) to up its stake to 66%.
The remaining shares of Telco are held by Italian banks Intesa Sanpaolo SpA and Mediobanca SpA, which each have 11.62% currently, and Assicurazioni Generali SpA, which has 30.58%.
The three will gradually pare their stakes, with Generali dropping to 19.32% and Mediobanca and Intesa Sanpaolo to 7.34% each.
Telefonica will maintain its existing voting rights at 46.2%.
The Spanish carrier will have the right in a second phase to increase its stake in Telco to 70%, and the option to purchase the rest of the shares from its Italian partners from 2014.
Telefonica said it ‘‘renews its commitment to contribute to the development of Telecom Italia in its domestic market.’’
Telecom Italia, once the national telephone company, has been struggling with a price war in the market and with the recession.