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Telecom Italia has purchased on the market a total of 103,184,250 saving shares at an average price of 6.295 euros. Such purchases were undertaken to carry out the resolution of the Shareholders’ Meeting of January 14, 2000

12/28/2000 - 12:00 PM

Telecom Italia today signed an agreement to increase its stake from 25.63% to 54.76 % in Entel S.A. (Entel Chile), one of the largest telecommunications companies in this South American country. Consolidation of its presence in Chile enables Telecom Italia to further strengthen its position in Latin America, an area of special strategic importance to its international operations.

Under the agreement Telecom Italia is to acquire the stakes held in Entel Chile by the Chilquinta Group and Matte Groups, respectively 25.63% and 3.50% of company share capital. The overall value of the transaction is US$905 million (US$820 million to Chilquinta, US$85 to Matte). The operation, which is part of the Group´s program of international expansion, already announced to the market, and the relative payment are expected to be completed within January 2001.

Telecom Italia has owned equity in Entel Chile since 1996 through Stet International Netherlands (SIN). This acquisition enables Telecom Italia to gain control of Entel and take over the country´s leading mobile and long distance telephony company. This significant step in the internationalization of the Telecom Italia Group is part of company strategy to consolidate and strengthen its presence in Latin America, an area that, alongside Southern Europe and the Mediterranean Basin, is one of the Group´s principal focuses for growth.

Listed on the Santiago stock market since 1984, Entel Chile is Chile´s principal domestic and international long-distance operator. The company is also the leading supplier of private corporate networks and Internet access, as well as offering local telephony services to targeted clients.

Subsidiary Entel PCS is Chile´s leading mobile telephony operator, and was the first company in Latin America to roll out GSM 1900 technology. Entel S.A. recently acquired the remaining 25% of Entel PCS from Motorola, an operation that increased its equity stake to 100%.

Entel also benefits from a significant presence in the Spanish-speaking US market through its Americatel subsidiary, which offers long-distance and data transmission services between the US and Latin America.

Telecom Italia´s strategy for future development of Entel Chile foresees expansion of the company´s operations and reach in Latin America. This is to be achieved by leveraging the excellent results attained in long-distance operations, and by offering integrated services packages in high-growth sectors such as mobile telephony, data transmission services and the Internet.

Telecom Italia confirms its full support of company management, headed by Richard Büchi, as it takes control over Entel S.A..

Roberto Colaninno, Telecom Italia´s Chairman and CEO, made the following statement about the transaction: "This agreement concludes the consolidation phase of our most important fixed-line and mobile participations in Latin America, one of the strategic regions for our Group´s international development. We are especially pleased to have concluded this deal with the Chilquinta and Matte groups. Over the years we have worked with these partners with a great degree of understanding and collaboration, in the process contributing to the company´s growth and success. Entel is a successful company to which we will bring our abilities and experience as a global operator in fixed-line and mobile telephony, in order to reach the standards of competitiveness and innovation demanded by a rapidly expanding market."