Telecom Italia sells stake in Neuf Telecom for 161 million euro

05/09/2006 - 02:52 PM

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THE SALE WILL GIVE THE TELECOM ITALIA GROUP A CAPITAL GAIN OF 110 MILLION EURO AND DEBT REDUCTION OF 161 MILLION EURO

THE SALE IS PART OF THE TELECOM ITALIA GROUP’S STRATEGY OF RATIONALIZING NON-STRATEGIC HOLDINGS

Telecom Italia, through its subsidiary Telecom Italia International N.V., has sold its 4.99% stake in Neuf Télécom to the Louis Dreyfus (LD) and Societè Francaise du Radiotèlèphone (SFR) groups for approximately 161 million euro, as well as an additional payment in the case of an IPO, or sale of control of Neuf Télécom, at values higher than those agreed. Should neither of these events take place before 31 December 2007, Telecom Italia International N.V. will still have rights to an additional payment if thefair market value of the stake is higher than the price of the present transaction.

The sale will give the Telecom Italia Group a capital gain of 110 million euro and will have a positive impact on debt of 161 million euro.

The sale of the Neuf Télécom stake is part of the Telecom Italia Group’s strategy of rationalizing its international portfolio with a focus on areas of strategic interest and potential for growth. The strategy was announced to the market on 8 March 2006 during the Group’s annual meeting with investors.