Telecom Italia Agrees to Sell Argentinian Subsidiary
Published on: 14th Nov 2013
Note -- this news article is more than a year old.
As has been widely expected, Telecom Italia has sold its controlling stake in Telecom Argentina to the Fintech Group. The company is getting USD960 million from the sale.
The company will get just under USD860 million upfront, and a further USD100.5 million later subject to additional agreements, including an agreement to continue providing Telecom Argentina with technical support and other services for up to three years.
Telecom Italia owns an economic interest of 22.72% in the Argentinean subsidiary, but through various secondary holdins, had effective management control over the company.
In the first nine months of 2013, the division reported revenues of EUR 2.9 billion with an EBITDA margin of 27.9%.
The company warned though that the net effect on its consolidated net debt is not expected to be material, assuming constant exchange rates.
The sale is part of the indebted Italian company's efforts to raise EUR4 billion by 2016 towards paying down its EUR38.2 billion of debt.
It is also the first major transaction since Spain's Telefonica raised its stake in the Italian company. Both companies have competing operations across Latin America, and Telefonica's raising interest in Telecom Italia has raised competition worries in some countries.