Telefonica agrees on cash-and-share deals to increase stake in Telecom Italia
On Tuesday, Spanish telecoms group Telefonica agreed to cash-and-share deals valued at around EUR860 million or USD1.2 billion in order to increase its stake in Telco. Telco is the controlling shareholder of Telecom Italia. In a complex series of transactions and would be seen following approval by antitrust regulators, Telefonica through Telco would have full control of Telecom Italia.
Telecom Italia is the largest telecommunications company in Italy. The shares of the Italian telecoms group would been valued at EUR1.09 per share.
Espirito Santo Investment Bank analysts had said about Telefonica's move, "We believe this additional investment made by Telefonica in Telco was the price the company was willing to pay to keep its options open at Telecom Italia and keep at large any other third party that could be interested in Telecom Italia and especially its Brazilian assets."
Telecom Italia owned the Brazil-based Tim Participacoes mobile unit, which has been largely prized by investors and is the reason why the Italian telecoms company has been seen as a potential target for a takeover.