Italian operator Wind could face some changes in 2014 as its New York-listed Russian parent VimpelCom is reportedly considering various options for the operator, including a sale or merger of the company.
According to a report in the Financial Times, executives from the acquisitive Hutchison Whampoa have met VimpelCom, although unnamed sources said talks did not progress as far as negotiations over a merger or sale. Other options for the unit include a refinancing of Wind's high debt, which amounts to around $14 billion (€10.16 billion).
The companies involved have not commented, according to the report, and the unnamed sources close to the matter told the FT that no decision has been made on any of the options under discussion.
Hutchison already owns 3 Italy and is known to be interested in building up its operations in the Italian market. The Hong Kong-based company has previously attempted to reach an agreement with Telecom Italia on a merger of their respective mobile assets, but talks between the two ended in July.
Wind is the third-largest operator in Italy behind Telecom Italia and Vodafone Italy, while 3 Italy is the smallest player on the market. Analysts at Sanford C. Bernstein told the Financial Times that net debt at Wind is 4.7 times the business's earnings, which they say could make a sale at a similar multiple attractive to VimpelCom shareholders.
According to reports from May, VimpelCom said Wind was not for sale, although at the time this was seen as an effective rebuff to former Wind owner Naguib Sawiris.
Hutchison Whampoa has been on a mission to build up its assets in Europe. The company is in the process of buying O2 Ireland for at least €780 million ($1.07 billion) and as much as €850 million, and has already acquired Orange Austria to create the "new Three" in Austria. CCS Insight has also forecast that Hutchison could buy O2 UK in 2014.
- see this FT article (sub. req.)
Telecom Italia quits talks with Hutchison for mobile merger
3 Ireland targets No. 1 spot following O2 Ireland deal
Hutchison's €1.3B Orange Austria bid faces T-Mobile challenge
VimpelCom puts Wind off limits to Sawaris, as MegaFon gains ground in Russia