Bangkok Post

Telefonica raises stake in Telecom Italia

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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.

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