By Giovanni Legorano
Italian companies Mediobanca SpA, Intesa Sanpaolo and
Assicurazioni Generali said Monday they have decided to withdraw
from Telco, a holding company controlling a 22.4% stake in Telecom
Italia SpA, in a move that paves the way for Spanish Telefónica to
become the single largest shareholder in Italy's telecom giant.
Mediobanca, Intesa and Generali said they exercised their right
to pull out of the pact as per the terms of the shareholder
agreement. This will leave the two lenders with direct stakes in
Telecom Italia of 1.6% each and the insurer with a 4.3% stake. The
other shareholder in Telco is Telefónica.
The decision of the three Italian shareholders is likely to lead
to the dissolution of the holding company altogether. As a result
of this operation, which will take a few months to complete,
Telefónica will end up becoming the largest single shareholder in
the Italian firm, with a direct stake of around 15% of Telecom
Italia.
This is likely to reignite competition concerns that the
Brazilian antitrust regulator has expressed. Both Telefónica and
Telecom Italia have important assets in Brazil--Vivo and Tim
Participacoes--and the Brazilian regulator has already said that
Telefónica has to shed either its stake in Telecom Italia or in
Vivo.
Telefónica has tried to ease the Brazilian regulator's concerns
by withdrawing its representatives from Telecom Italia's board in
December.
However, Telecom Italia isn't willing to let go of Tim
Participacoes, as Chief Executive Officer Marco Patuano has
repeatedly said it is a core asset to the company.
Mediobanca's exit from the investment in Telecom Italia is part
of the merchant bank's plan to shed part of its large investments
in Italian companies, which marks a drastic turnaround from the
bank's decadeslong strategy.
Last June, the bank said it would slash its equity exposure by
EUR2 billion ($2.7 billion) by June 2016, selling stakes in
companies such RCS Mediagroup and part of its stake in Generali,
besides its Telco investment.
Mediobanca started to reduce its stake in Telco in September,
with a drop of its holding to 7.3% from 11.6%.
Intesa's and Generali's executives have repeatedly said in
recent months they would exit investments considered noncore, such
as Telecom Italia, as part of their strategies.
Write to Giovanni Legorano at giovanni.legorano@wsj.com
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