The Kkr fund puts up to 11 billion euros on the table to take all of Tim. Yesterday the president of the telephone group, Salvatore Rossi, illustrated the proposal to the board of directors called urgently. The US fund presented a non-binding expression of interest, configured as friendly, aimed at promoting an offer on 100% of Tim which aspires to obtain the approval of the directors of the Company and the support of the management.
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The US fund is willing to offer 50.5 cents per share to all Tim shareholders, valuing the 11 billion telephone group. Adding the approximately 35 billion in debt, the Kkr maneuver is worth over 46 billion euros overall. The fund asked for four weeks to conduct the verifications before confirming the offer, which would be valid upon reaching 51% of the capital. Times are tight. And the road is not downhill.
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The board meeting yesterday was rather tense due to the contrariet of Vivendi, Tim’s first shareholder, who for some weeks has been tightening on the CEO Luigi Gubitosi, to get to the redde rationem. Kkr’s foray has displaced the French, who yesterday morning confirmed their desire and willingness to work alongside Italian authorities and public institutions for Tim’s long-term success. Position reaffirmed in the council, expressing opposition to the offer of Kkr which they consider hostile and solicited by Gubitosi. Which certainly has relations with the US fund, having negotiated a year ago their entry into FiberCop, the company that contains a piece of Tim’s network. The French are considering how to respond. Yesterday they denied contacts for a counter-agreement with the CVC fund, which together with the private equity Advent said it was interested in a system operation on Tim.
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May a counter offer always be possible. Yesterday, the Ministry of Economy – present in Tim’s capital through the Cassa Depositi e Prestiti – explained that it considers the interest of these investors to make investments in important Italian companies a positive news for the country. announcing the creation of a government task force to examine in particular the passages on the telephone network, a strategic asset for national security, on which the plan for the digital transition indicated in the Pnrr passes. The government has the powers of the Golden Power, to which the offer is subordinate. And it is likely that if the takeover is successful, Tim’s reorganization will also be an opportunity to fix the infrastructure definitively. A new board from Tim is scheduled for next Friday, initially convened at the request of the majority of directors to continue the examination of strategies. With Kkr’s offer on the table, this is likely to be discussed. Advisors must be appointed. Since this is a non-binding offer, the passivity rule (the issue was touched upon yesterday in the council), the rule that limits the board’s range of action, is not triggered. And therefore, in principle, Vivendi could still try to force a change at the top, even if with a takeover bid it would be risky. There are four weeks and even if the French will try to procastinate, the feeling that it will not be easy to stop Kkr.
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