Telecom Italia to split?

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Bloomberg News is headlining a quote from Italian economic development minister Carlo Calenda saying that Telecom Italia (TI) should be split into two listed companies (Network Co and retail company), and that he is in talks to define the ‘perimeter of the network’.

This report comes followinf news last week that Vivendi is set to lodge an appeal against the government’s decision to activate the so-called ‘golden power’ rule over TI.

Equity advisors at investment bank Exane/BNPP says that TI remains mired in political uncertainty. “The benefits [and practicality] of network separation are [to us] highly uncertain. To complicate matters further Italians are due to head to the polls on the 4th of the March in the latest general election, which has the potential to significantly change the political landscape of Italy, and with it the current views on TI. In the meantime TI’s new CEO is not scheduled to present his new industrial plan until March 2018 and given the above uncertainty we struggle to see why anyone would seek additional exposure to TI before the elections, and with Iliad’s planned launch in 2Q17.”


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