Italian tyre, cable and real estate group Pirelli is weighing the sale of its controlling stake in Telecom Italia, a move complicated by concerns over price as well as reluctance on the part of the Italian government.Pirelli chairman Marco Tronchetti Provera said on Monday he had received authorisation from his board to "study all options, including a sale" of the company's stake in Italy's leading telecommunications provider.Pirelli owns 80 percent of Olimpia, the holding company that has an 18-percent interest in Telecom Italia, one of the jewels of the Italian national economy.Pirelli took control of Telecom Italia in 2001 at 4.2 euros per share, an unfortunate investment, since the share price on Tuesday had fallen to 2.17 euros.In the past six years Telecom Italia has cost Pirelli and the Benetton family, the other Olimpia shareholder, about 3.0 billion euros, according to the newspaper Il Sole 24 Ore.Although a sale of the Telecom Italian stake would likely be welcomed by investors, the operation could face two obstacles.Italian press reports have said a group of banks would be prepared to offer 2.6-2.7 euros per share for Telecom Italia, a proposal that could fail to satisfy Pirelli.At the same time the Italian government has shown little enthusiasm for the transaction, which could open the door to further foreign participation in the telecoms sector.There has been speculation here that Hinduja of India and Sistem of Russia could be interested in taking a minority position in Telecom Italia.Another Italian operator, Fastweb, is now the takeover target of Swisscom of Switzerland, while mobile phone companies Wind, Vodafone and Hutchison are already foreign controlled.
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