Open Fiber, Enel Starace’s number one resists pressure: “We will sell the stake at the right price”

The government goes in pressing on Enel for the single network, but the CEO Francesco Starace holds back: “We are ready to monetize when there is an opportunity in line with our interests” explained the manager, during the presentation of the industrial plan 2021-23 of the energy group controlled by the Treasury. “As we have always said we will never be a telecommunications operator, but we will limit ourselves to managing infrastructures“Reiterated the number one of Enel who, together with Cassa Depositi e Prestiti, check out Open Fiber. And that is the company that is investing in the construction of new national telecommunications network and that the Conte government hopes to get married with FiberCop, controlled by TIM.

In full management autonomy, the manager silently acknowledged the government’s interest in the single network. But he considered it more interesting for Enel, and for its shareholders, to wait better times for a possible sale of the stake in Open Fiber. A project that today, according to the evaluations of the potential buyer Macquarie, is worth beyond 7.7 billion. And that Enel will sell only if “the price is right”. “We have developed an original model, as an operator wholesale only (only for operators, not for end customers), which supplies fiber at competitive prices to all companies – added Starace -. In 4 years we have more than doubled the capacity of the incumbent (the former monopolist TIM) in connections and today we see the opportunity to monetize this value that has been created ”.

The letter from the ministers to Starace – But precisely because of the results achieved, rather than selling, the CEO of Enel thinks instead of repeat the happy investment experience: “We want to replicate this model also in other parts of the world where we see similar or similar conditions”. A cold shower for the Treasury Minister, Roberto Gualtieri and that of economic development, Stefano Patuanelli, who on the day before the presentation of Enel’s business plan, had sent a missive a Starace to warmly invite him to participate in the unique network project that foresees the wedding between Open Fiber and FiberCop. With a decidedly invasive political intervention towards a company which, although controlled by the Treasury, is listed on the Milan Stock Exchange and is therefore subject to the market rules. It is not the first time that the government has used this strategy. Already this summer, the premier Giuseppe Conte had contacted Tim’s CEO, Luigi Gubitosi, per stop the FiberCop plan with the objective, then faded, of arriving directly at the single network. In this case, the interference of the executive in the affairs of a private company it hadn’t generated any reaction by the market. A sign of investors’ low confidence in the executive’s moves.

Dividend policy pleases the market – It went differently today with the Enel stock which gained over 4% on the stock market. Not so much for the Open Fiber case, but rather for the fact that the group goes beyond 77 billion in turnover has “defined a policy of simple, predictable and attractive dividends. Shareholders will receive a fixed, guaranteed and increasing dividend per share over the next three years, with a target of € 0.43 / share by 2023, which translates into a compound growth (CAGR) of approximately 7% “, as stated in the strategic plan to 2023. Furthermore, Enel, which will invest 40 billion over three years, has provided for a improvement of the financial situation with debt that should reach 57-58 billion by 2023. Finally, after about 5-5.2 billion euros in 2020, the company led by Starace has made it known that it is aiming for a ordinary net profit of 5.4-5.6 billion in 2021, of 5.9-6.1 billion in 2022, of 6.5-6.7 billion in 2023. Results that guarantee the Treasury a generous annual coupon. Regardless of the future of Open Fiber and the single network. According to Starace, the public control of which, in the event of Enel’s farewell, must be guaranteed by Cassa Depositi e Prestiti, contrary to what Tim who hopes he can keep 51% in the eventual sole company of the telecommunications network.

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