Italian insurance company Generali has said it could exit its holding in Telecom Italia as early as June, although experts suggest that its stake will not be acquired by Telefónica because of regulatory obstacles.
According to Bloomberg, Generali CEO Mario Greco said during a conference call on the company's 2013 results that the insurer has two exit windows: one in June 2014 and one in February 2015. "It's likely that we will exit in June's window," Greco said.
Generali owns a 19.3 per cent stake in Telco SpA, which in turn owns 22.4 per cent of Telecom Italia. Bloomberg estimated that the Generali stake is currently worth about €500 million ($700 million) and equates to around 4.3 per cent of Telecom Italia.
Greco's comments came after Generali announced a further writedown of its Telco stake. The company said it had decided to revalue its investment in Telco on the basis of a Telecom Italia share price of 72 cents per share with an impact on its net income of €189 million. "Hopefully, these adjustments puts behind us any further negative financial risks," the insurer said.
Carlo Alberto Carnevale Maffe, a professor of business strategy at Milan's Bocconi University, told Bloomberg that Generali could join the other Italian shareholders of Telco, Intesa Sanpaolo and Mediobanca, in selling their stakes to the same buyer. However, he said Telefónica is unlikely to buy Generali's stake.
Since it reached agreement to gradually increase control of Telco, Telefónica has fallen foul of Brazil's antitrust authority because it competes with Telecom Italia in Brazil. The Spanish company has come under pressure to reduce its Brazilian holdings or convince Telecom Italia to sell its TIM Brasil unit.
Telecom Italia has continued to reiterate that TIM Brasil is strategic for the company and there are currently no plans to sell the unit.
In separate reports, Borsa Italiana chairman Massimo Tononi has been cited as a candidate to head the Telecom Italia board. Reuters noted that no final decision has been made and other candidates may be proposed before Telecom Italia's annual meeting scheduled for April 16.
Aldo Minucci was appointed as interim chairman after Telecom Italia split the roles of CEO and chairman following the departure of Franco Bernabe in October. Marco Patuano was appointed as CEO.
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