Report: Swisscom mulls Fastweb sale, with Vodafone seen as frontrunner

It's a frequently occurring rumour, but a new report suggests that Swisscom is in discussions on a possible deal for its Italian unit, Fastweb, with Vodafone regarded as a likely candidate to buy the broadband provider.

Citing unnamed sources, Reuters reported that the Swiss operator is in talks with USB, an adviser of Vodafone, on a deal that could be worth up to €5 billion ($6.3 billion).

In comments emailed to FierceWireless:Europe, a Swisscom spokesman said the company did not comment on speculation, and noted that rumours about Fastweb have been around for a long time and pop up from time to time.

The operator merely repeated its statement that Fastweb is on track in Italy despite strong competition and price pressure and will continue to pursue the same strategy.

Swisscom acquired Fastweb at an enterprise value of €4.2 billion in 2007, and has so far been reluctant to sell the company. Vodafone has expressed interest in the company in the past, and indeed a Fastweb acquisition would complement the group's strategy to ramp up its fixed assets in markets where it already provides mobile and fixed services.

For example, Vodafone recently acquired cable operators Kabel Deutschland in Germany and Ono in Spain.

In Italy, the addition of Fastweb assets would help the company to better compete with rival operators Telecom Italia, Three Italy and Wind.

As Reuters noted, Telecom Italia is also exploring ways to strengthen its fibre business by acquiring a 53.8 per cent stake in network specialist Metroweb Italia from infrastructure fund F2i. Fastweb owns 10.6 per cent of Metroweb.

Vodafone operates Italy's second-largest mobile operator and fourth-largest broadband provider in subscriber terms.

According to TeleGeography, Fastweb is just ahead of Vodafone in the broadband market with just under 2 million subscribers at the end of June 2014. A merger of the two companies would see Vodafone overtake Wind to take second place in this segment behind Telecom Italia.

For more:
- see this Reuters article
- see this TeleGeography article

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