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The French telecoms group has informed the Italian government that it is once again exploring a potential tie-up, according to reports
Iliad Italia is once again looking for potential tie-ups with Italy’s incumbent operator TIM, according to reports by local Italian news agencies Corriere della Sera and La Stampa.
The reports say that Iliad has this week informed the Italian government of its intentions to pursue dealmaking with TIM. The Italian government has likely been informed due to its 10% stake in TIM as well as its so-called ‘golden powers’ that allows the state to veto any deal involving critical infrastructure – such as the country’s largest telecoms operator TIM – being taken over by a foreign company.
Reports suggest that the deal would take the form of a merger, with a Reuters report confirming that Iliad does not intend to see TIM’s business units carved up.
The Italian mobile market has been crying out for consolidation for years. Iliad entered the already competitive market in 2018 and rapidly initiated a brutal price war that has seen the operators’ profit margins slashed. Since then, all four of the country’s mobile operators (Vodafone, TIM, Iliad, and WindTre) have been involved in various merger discussions.
In fact, Iliad itself had initially sought a merger with the seemingly more vulnerable Vodafone Italia back in 2023. Ultimately, however Vodafone Italia instead struck a deal to be acquired by Swisscom for €8 billion, with Swisscom merging the business with its local fixed broadband unit Fastweb.
But despite a market-wide consensus on the need for consolidation, a direct merger between TIM and Iliad would likely draw some critical regulatory attention. The deal would create a dominant market leader, commanding around 41% of the mobile market and 40% of the fixed broadband market.
Interestingly – and entirely separate to this interest from Iliad – reports are also noting that investment firm CVC Capital Partners has also informed the government of its intention to approach TIM.
CVC has shown interest in the Italian incumbent for a number of years now, having first made a non-binding offer for a minority stake in the company’s enterprise unit back in 2022.
Now, CVC is reportedly showing interest in buying the 24% stake in TIM held by French investment company Vivendi.
Vivendi has been notably critical of TIM’s sale of its fixed network infrastructure to KKR last year, saying that the assets were severely undervalued. The company has attempted to undo the deal through various legal means over the past year, none of which have yet borne fruit.
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