(Alliance News) - Telecom Italia Spa announced Monday that it has finalized the sale of NetCo to Kohlberg Kravis Roberts & Co. L.P. through the transfer to FiberCop, a 58 percent subsidiary of TIM, of TIM's business unit comprising fixed network infrastructure and wholesale activities, and the subsequent acquisition of the entire capital of FiberCop by Optics BidCo, a subsidiary of KKR.

"The transaction for the sale of NetCo, valued up to a maximum of EUR22.0 billion inclusive of earn-outs linked to the occurrence of certain conditions, allows TIM a reduction in financial debt in line with what has already been communicated to the market," the released note reads.

Specifically, the expected deleverage at closing, gross of the usual adjustments for this type of transaction, is confirmed at EUR14.2 billion.

Adjustments and separation costs totaling EUR400 million are also confirmed, in line with what was indicated to the market in the Addendum to Capital Market Day last March 11, resulting in an effective net of EUR13.8 billion.

The company also reports, that the cash component corresponding to the PNRR advances related to FiberCop, amounting to EUR400 million, was deconsolidated in the context of the transaction and, following the sale, the relations between NetCo and TIM are regulated through a Master Service Agreement that has a duration of 15 years, renewable for an additional 15 years, and services will be rendered at market prices and without minimum purchase commitments.

"The finalization of the transaction with KKR and MEF is the result of two and a half years of work, which have served to realign TIM's day-to-day management and identify those solutions, industrial and financial, that will allow us to face the next challenges ahead," said Pietro Labriola, TIM CEO.

TIM shares closed Monday up 1.1 percent at EUR0.23 per share.

By Chiara Bruschi, Alliance News reporter

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