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Telecom Italia eyes sell-offs to boost broadband

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Telecom Italia eyes sell-offs to boost broadband
Telecom Italia is €28.8 billion in debt. Photo: Vincenzo Pinto/AFP
11:05 CET+01:00
Telecom Italia has agreed to sell its stake in Telecom Argentina as well as telephone masts in Italy and Brazil, the troubled Italian giant said after a board meeting held on Thursday.

It said the sell-offs would help raise €4 billion over the 2014-2016 period as the company struggles to reduce its staggering €28.8 billion mountain of debt.

The plan "envisages some extraordinary transactions intended to strengthen the group," Telecom Italia's chief executive Marco Patuano said in a statement.

The measures include a €1.3 billion bond issue.

Patuano said this would help the company expand an ultra-fast 4G mobile network and increase fibre-optic broadband provision in Italy and Brazil.

The board meeting was the first since chairman Franco Bernabe stepped down last month following uproar in Italy over a campaign by Spain's Telefonica to boost its stake in the company.

SEE ALSO: Telecom Italia faces tense board meeting

Telefonica now holds a 66 percent stake in a holding company which in turn owns 22.4 percent of Telecom Italia, but has an option to own the holding company outright next year and bceome the largest shareholder in Telecom Italia.

The Italian government is looking into ways of modifying the current law on takeovers to prevent Telefonica from increasing its stake, saying this would mean more security and more jobs for Italy.

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