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Telecom Italia puts stop to KKR's takeover bid

Kerry Flynn
Apr 8, 2022
Illustration of an outstretched hand holding a squashed red wifi signal
Illustration: Sarah Grillo/Axios

Telecom Italia has stopped KKR's 10.8 billion euros ($11.8 billion) takeover bid, at least for now.

Why it matters: There's been a frenzy of dealmaking in telecom as companies require capital and scale to compete in the race to 5G. While Telecom Italia stopped the KKR bid, it's reportedly considering other deals.

What's happening: Telecom Italia's board of directors unanimously ruled Thursday that it would not grant KKR the due diligence it requested. KKR had proposed this bid in November.

  • “If KKR decides to unveil a concrete, complete and attractive offer that would include the price per ordinary and savings shares, Telecom Italia's board could reconsider its decision,” the company said in a statement.
  • CVC Capital Partners also bid for 49% of Telecom Italia's new enterprise services unit last month. But the deal, valued at 6 billion euros ($6.5 billion), is seen internally as too low, Bloomberg reports.
  • Private equity firms Apollo Global Management and Apax Partners also have considered investments in Telecom Italia, Reuters reports.

What's next: Telecom Italia CEO Pietro Labriola has been working on a plan to split its business, which could include merging the company's landline assets with those of Open Fiber.

The bottom line: "The company needs radical restructuring which may be best achieved outside public markets ... KKR and Telecom Italia share the same vision of creating separate companies for the network infrastructure and customer-facing businesses." — Chris Hughes, Bloomberg

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