Italy is considering a less expensive route to win control of broadband operator Open Fiber, three sources familiar with the matter said on Wednesday, as it looks to play a steering role to boost connectivity across the country.
Open Fiber is jointly owned by Italy’s biggest utility, Enel, and state lender Cassa Depositi e Prestiti (CDP).
Enel has been in talks to sell up to 50% of the fiber infrastructure group to Australian fund Macquarie for 2.65 billion euros ($3.11 billion) since last year and a deal is expected to be clinched by June.
The original scheme envisaged CDP buying 10% of Open Fiber from Enel and negotiating governance rights with Macquarie to secure control.
But disagreements over the value of Open Fiber have prompted the sides to discuss alternative routes, the sources said.
According to the new scheme under discussion, Enel would sell all or part of its 50% stake to Macquarie, after which CDP would raise its stake to 51% through a capital increase, the sources said.
CDP and Macquarie declined to comment. Enel was not immediately available for comment.
In this way, CDP could save hundreds of millions of euros to win control of the joint venture.
One of the sources said talks were at an advanced stage, adding Enel could retain a small stake in Open Fiber.
Italy’s previous government had championed CDP’s efforts to win control of Open Fiber as part of a broader plan to merge it with the landline assets of former phone monopoly Telecom Italia (TIM).
But some ministers from Mario Draghi’s new government have cast doubt on the project, saying Rome is reviewing its options.
TIM, in which CDP is the second-largest shareholder behind French media company Vivendi, has repeatedly said it will not agree to owning less than 50% of any single network company – something that could trigger regulatory issues.
A fourth source said the industry ministry was studying other options including co-investment schemes to allow operators to build their networks in some areas and clinch commercial agreements elsewhere.
The Draghi government has put digital infrastructure at the heart of its agenda and is counting on grants from Europe’s Recovery Fund to speed up fiber rollout.
Draghi has yet to say if his administration intends to implement the unified network project but the Treasury is in the meantime pressing ahead with plans to make sure CDP has control of Open Fiber, one of the sources said.
Source: Reuters.com