​Mediaset €1.2bn bid for RAI’s tower network operator

Mediaset’s broadcasting network operator Ei Towers has launched a bid for its counterpart RaiWay, owned by public broadcaster RAI.

The cash and stock offer values RaiWay at €4.50 per share, or €1.22 billion. The cash component corresponds to approximately 69 per cent of the aggregate valuation of each RaiWay ordinary share, while the share component corresponds to approximately 31 per cent of the aggregate valuation of each RaiWay ordinary share.

Mediaset said it will vote in favour of the proposal to be put to an extraordinary meeting of the shareholders of EI Towers due to be held on March 27th. The deal would create a single large national operator in the sector of TV and radio broadcasting infrastructures in Italy, consisting of approximately 5,000 towers.

According to Mediaset, the transaction will provide a remedy to the current situation of inefficient infrastructure multiplicity deriving from the existence of two large national operators, therefore putting Italy on the same level of the main industrialised European countries, where infrastructures are generally managed by a single operator on a national level.

However, the news has triggered a political outcry in Italy and concerns about anti-trust and competition issues as Mediaset, in which Former Prime Minister Silvio Berlusconi is the biggest shareholder, already dominates much of the TV sector in Italy.

The 5-Star Movement (M5S) called for an intervention by the telco regulator (AgCom) to prevent the creation of a monopoly in a strategic market to protect consumers, employees and pluralism. The Democratic Party (PD) said the Mediaset bid seems baffling, as the Italian government had clearly stated that RaiWay’s quotation on the bourse is tied to it ceding a shareholding of not more than 49 per cent, adding that RAI has put just 34.9 per cent of the capital of RaiWay on the market.

The Ministry of Development recalled that, although the government last year opened the door for a partial sale of RaiWay, it also ordered RAI to maintain a stake of at least 51 per cent of the transmission division. For its part, Italy’s Antitrust Authority confirmed it had received notification of the transaction and will consider whether it can give the green light.

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