Italy Considers Domestic Alternative for Telecom Italia Stake

Prime Minister Meloni's Government Favors Poste Italiane Stake Swap

Rome, Italy - Italy is exploring a domestic solution to counter international investment interest in Telecom Italia SpA, particularly from CVC Capital Partners and Iliad SA.

Poste Italiane Poised to Acquire Stake

Prime Minister Giorgia Meloni supports a stake swap that would grant postal and banking operator Poste Italiane a 9.8% stake in Telecom Italia, currently held by state lender Cassa Depositi e Prestiti (CDP). In turn, CDP would receive Poste's 3.8% stake in payments specialist Nexi SpA. A cash adjustment may also be included in the deal.

Poste's board will consider the proposal on Saturday and is anticipated to announce a decision that day.

Government Protectionism

The move, backed by the government, aims to strengthen Poste's role as a financial and logistics provider, while safeguarding Italy's phone industry from further foreign control. Telecom Italia recently became a potential acquisition target following debt reduction efforts.

Edoardo Liuni, head of trading at Trading Room Roma, suggests that "regulatory and political pressure" may be driving the shift towards Poste as a partner, despite its perceived lower attractiveness compared to Iliad from an industrial and synergy perspective.

Government Blocks CVC Offer

Earlier this week, Meloni's government rejected an offer by CVC to purchase a stake in Telecom Italia held by Vivendi SA, the largest shareholder with approximately 24%. The acquisition could have potentially led to a merger with Iliad.

National Champion Protection

Since assuming office, Meloni's government has prioritized protecting companies it considers "national champions" by repelling foreign acquisitions. This includes leveraging local investors and the "golden power" provision, which allows the state to intervene in certain transactions involving strategic assets.

Poste is viewed as a suitable partner for Telecom Italia, as the postal operator operates the country's largest mobile virtual operator and plans to switch to Telecom Italia as its network provider.

Banking Consolidation Efforts

Meloni played a significant role in the spinoff and sale of Telecom Italia's landline grid and the latest round of banking consolidation efforts. The government supports Banca Monte dei Paschi di Siena's attempt to acquire Mediobanca SpA, aiming to create a third major Italian banking group.