Hutchison Whampoa Frustrated with Telecom Italia Merger Talk Delays
Published on: 2nd Jul 2013
By: Ian Mansfield
Hutchison Whampoa is reportedly losing patience with Telecom Italia over plans to merge their two mobile networks. The two companies confirmed that they are investigating the possibility of a merger between their mobile networks back in April.
Telecom Italia's board of directors is due to discuss the possible merger of the two networks later this week, having previously delayed such a discussion. However, citing people familiar with the talks, Reuters reported that the ongoing issue of the separation of its landline assets could push back the mobile talks even further.
"Telecom Italia has opted for the network separation. The merger with 3 Italia has been slowed for political reasons and [Hutchison's] patience has a limit," one of the sources said.
Hutchison Whampoa's Three network is the smallest of the country's four mobile networks with a customer base of around 9.5 million. It is estimated to be worth around US$1.9 billion.
However, Telecom Italia is itself looking to cut its debt, so a merger is likely to be based on shares rather than cash. Hutchison would then be able to cash out at a later date by selling its newly acquired shares in Telecom Italia on the open market.
On the web: Reuters