- TIM plans to reinstate dividends in 2026, supported by Sparkle sale proceeds
- The sale of Sparkle to MEF and Retelit for €700 million is set to be completed by 2026
What happened: TIM’s financial restructuring and the Sparkle sale
TIM has announced its plan to reinstate shareholder dividends starting in 2026, contingent on the completion of the Sparkle sale. The Italian telecommunications company revealed its financial results, noting that revenue growth has been driven mainly by its Brazilian operations. The company also disclosed the approval of the sale of its subsea cable business, Sparkle, to the Ministry of Economy and Finance (MEF) and Retelit for €700 million.
The Sparkle deal is expected to be finalised by early 2026, once necessary regulatory approvals have been granted. TIM highlighted that the proceeds from this sale would help fund its dividend payments, which will amount to 70% of its free cash flow in 2026 and 2027. The deal also includes an extraordinary dividend, where half of the Sparkle sale proceeds—around €350 million—will be distributed to shareholders in 2026. TIM’s stock price increased following the announcement, reaching a 17-month high.
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Why it’s important
The reinstatement of dividends signals a positive shift for TIM after a period of financial restructuring. By reducing its net debt from over €20 billion to €7.27 billion, the company has been able to focus on returning value to shareholders. The sale of Sparkle, which includes the divestment of significant assets, will provide much-needed liquidity to further support the company’s financial plans.
For investors, the return to dividends is a key indicator of TIM’s improved financial health. The company has also been able to stabilise its operations in Italy, even though growth has been more modest in its domestic market compared to its Brazilian business. The proceeds from the Sparkle sale will not only enable dividend payouts but also solidify TIM’s position in the competitive European telecom sector.
