Tim: Kkr non-binding offer received for Netco – Economy

KKR has presented Tim with a non-binding offer for the fixed network, including Fibercop and the stake in Sparkle. The group communicates it in a note. Today the board will meet to start the review process.

The non-binding offer of the private equity fund Kkr, the note specifies, “refers to a shareholding to be defined, it being understood that the purchase would result in the loss of vertical integration with respect to Tim”.

The government “is closely following the offer presented by the Kkr fund” for a stake in Tim’s Netco, “a company that today has a crucial role in telephone services, in the creation of broadband in our country and in the infrastructure of the National Strategic Pole” reads a note from Mimit.

The government “deems the safeguarding of employment levels and the security of a strategic infrastructure such as the national network to be central
telecommunications. On these assumptions we will evaluate the developments concerning the first Italian telephone company”. Having entered the stock market with a bang, the Tim share continues its run.

Kkr is aiming for a stake in Netco, the newco that will arise from the separation of the network from Tim. We are talking about the entire fixed network, primary and secondary, domestic and international wholesale activities (Sparkle).

Netco, it emerged from the Capital Market Day, may represent the first case in Europe of the creation of a fiber network infrastructure and technology pole available to the entire market and with a widespread presence throughout the national territory. It will focus on the wholesale market with the task of further accelerating the deployment of the fiber network, benefiting in the medium-long term from the investment cycles and related returns typical of the infrastructure market.

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As at 30 September, NetCo managed 16 million fixed accesses (of which over 71% in FTTx technologies) with a market share of 82% and FTTx coverage of more than 94% of active lines (over 57% with speeds above 100Mbps). The technical units reached with FTTH technology were 7.2 million, equal to a coverage of around 29%, up by 4 percentage points compared to the end of 2021. In the 9 months of 2022, the latest data available while waiting for the Tim board of on Feb. 14 approve last year’s financial statements, NetCo reported total and services revenues down 4.8% and 3.8% year-over-year, respectively, with an improvement in the third quarter (-2.6% and – 2.7% respectively). The reduction is mainly due to one-off transactions booked in the first half of last year which had an impact of approximately 3.2 percentage points on the reduction in total revenues and 1.7 percentage points on that of revenues from services.

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