Telecom Italia has yet again postponed making a decision about whether or not to spin off its fixed-line network, as rumours continue to dog the operator about what it plans to do with its fixed and mobile assets.
According to Reuters, an unnamed source familiar with the matter say the Italian operator has valued its fixed-line network at between €13 billion-€15 billion ($16.8 billion-$19.4 billion). In a research note, Societe Generale said the company is reported to value its fixed-line network at up to €14 billion, Dow Jones Newswires added. That report said a spin-off of the network could add up to €4 billion to Telecom Italia's coffers, according to Societe Generale analysts.
However, Telecom Italia said it needs more time to evaluate a spinoff due to complex political and regulatory considerations, and has pushed back a decision until May 30.
"The network is an asset that is strategic for the security, growth and competitiveness of the whole county," Industry Minister Flavio Zanonato said this week, Reuters reported. Zanonato added that the Italian government is committed to safeguarding jobs and the security of Telecom Italia's fixed-line phone network.
If the network is separated from Telecom Italia, state-owned fund Cassa Depositi e Prestiti (CDP) could then buy a stake in the network company and help ease political concerns of the business falling into foreign hands, Reuters noted.
Telecom Italia is also evaluating a possible tie-up with 3 Italia, the mobile operator owned by Hutchison Whampoa, which is targeting a controlling stake in the Italian operator. However, strong differences of opinion about such a move between senior executives at Telecom Italia are reportedly causing some to doubt that such a deal will happen, according to ZDNet. The operator had given itself a month to decide on whether to move ahead with a possible tie-up with Hutchison Whampoa's 3 Italia, and the operator now has about two weeks of that period left.
It has also been speculated recently that Telecom Italia is mulling spinning off its mobile business along with its fixed-line business, although the operator has since denied that a break-up was under consideration.
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