Telecom Italia approves amendments to Telecom Argentina sale

Telecom Italia will amend the terms of its agreement that will see investment fund Fintech acquire its stake in Telecom Argentina.

The revised terms should be the final clincher for the deal, which has been delayed numerous times and at one point appeared to have fallen through.

In November last year, both parties agreed to recognise the value of the holding as $960 million. The updated terms now see Fintech paying $215.7 million by the end of October to secure an interest in Sofora – Telecom Argentina’s holding company – of 17 per minority. Sofora is owned by Telecom Italia International.

Following on from this – and subject to regulatory approval - Fintech will pay an additional $550.6 million to take a 51% controlling stake in Sofora currently held between Telecom Italia and Telecom Italia International.

This point is the factor that prevented the deal being approved as originally proposed. Telecom Italia believes that the takeover will happen within the next two and a half years; if it does not close by this deadline, TI will be able to reacquire the 17% that Fintech has already paid $113.7 million for since the original terms of the deal were agreed.

TI would also be able to sell the 51% stake to another party. The Italian incumbent is looking to offload assets in a drive to lower its debts.

 

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