Telecom Italia CEO Marco Patuano is reportedly due to meet Vivendi chairman Vincent Bollore this week in order to discuss an offer by the Italian company for the French group's Brazilian broadband unit, Global Village Telecom (GVT).
Telecom Italia CEO Marco Patuano
Citing unnamed sources close to the situation, Reuters said the two business leaders are due to meet in Paris on Wednesday or Thursday, although any offer will not be formalised before the Vivendi board meeting on Aug. 28.
Reports first emerged last week that Telecom Italia is in talks with Vivendi over an alliance that could lead to an acquisition of GVT and see Vivendi take a stake in the Italian operator.
Those reports come just days after Telecom Italia shareholder Telefónica launched an offer to buy the Brazil-based unit for a total value of €6.7 billion ($8.99 billion). As part of its offer for GVT, Telefónica also said Vivendi could buy up to 8.3 per cent of Telecom Italia's voting share capital.
Brazil is a key battleground for Telefónica and Telecom Italia, where they operate competing telecoms businesses under the Vivo and TIM Brasil brands respectively. Telefónica has also been under pressure from Brazilian regulator Cade since it boosted its investment in Telecom Italia shareholder vehicle Telco last year. Cade has ordered Telefónica to either sell its shares in Telecom Italia or dispose of Vivo.
The Spanish company's move to sell the Telecom Italia stake as part of a possible merger with GVT would certainly kill two birds with one stone: allay competition concerns in Brazil; and boost its Latin American operations by merging with a fast-growing player on the local broadband market.
For Telecom Italia, a deal with Vivendi would allow it to sever its ties with Telefónica, boost its Latin American operations and possibly secure Italian media group Mediaset in order to expand its media activities in Italy.
- see this Reuters article
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