- Telecom Italia sells Sparkle to Boost BidCo for $780M, with terms dependent on net debt and working capital.
- The deal aligns with Telecom Italia’s strategy to streamline operations and refocus on core business areas.
What happened: Sale of Sparkle to Boost BidCo finalised
Telecom Italia has confirmed the sale of its wholesale division, Sparkle, to Boost BidCo, a corporate vehicle under the control of Italy’s Ministry of Economy and Finance. The deal, valued at approximately $780M, also involves digital services firm Retelit and is expected to be finalised in the fourth quarter of 2019, subject to the usual closing conditions such as antitrust and Golden Power clearances.
While the sale price is set at $780M, Telecom Italia noted that the final figure could vary, depending on Sparkle’s net debt and working capital at the time of closure. The move follows an agreement by Telecom Italia’s board, which was supported by a related parties committee, and comes after the company had extended the deadline for Boost BidCo to finalise their bid.
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Why it’s important
This sale is part of Telecom Italia’s ongoing strategy to streamline its operations and focus on core business areas. By divesting Sparkle, a wholesale division, the company aims to strengthen its financial position and refocus on its primary services. The deal reflects a broader trend in the telecom industry where companies are shifting their portfolios to better adapt to market demands.
The involvement of Boost BidCo, a government-controlled entity, highlights the increasing role of public sector entities in the telecom sector. The inclusion of Retelit further enhances the strategic value of the transaction, potentially fostering future collaborations in digital services and infrastructure development. This move could have wider implications for the telecom landscape in Europe, especially regarding state influence in private industry.
