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TIM reportedly plans an even split between NetCo and ServCo

It looks like Italian operator group TIM expects its restructure to be close to a 50-50 split of staff and debt into the resulting new companies.

The latest bit of incremental news out of TIM comes, as it so often does, from anonymous sources whispering into the ears of Reuter reporters. They reckon around half of its current workforce of 42,500 Italian staff will be allocated to NetCo, which is the working name of the half of the company that will concern itself with domestic fixed line stuff and the Sparkle international carrier unit. It looks like a similar proportion of the company’s debt will also be assumed by NetCo.

It stands to reason, therefore, that whoever doesn’t go to NetCo will instead be signed up for ServCo, which will concern itself with the mobile network as well other enterprise businesses. Having said that, it remains to be seen what the total headcount will be when the great schism finally takes place, because TIM also has plans to make at least a thousand of them redundant.

The debt picture may also be very different at the moment of truth too, as the proposed merger with Open Fiber stands to raise a handy chunk of change. TIM could well use those funds to pay down debt and thus saddle its offspring with less debt at the start of their corporate lives.

There are a lot of moving parts involved in the resolution of the TIM situation. It has been focus of many a predatory corporate player for some time, with the apparent calculation that the sum of its parts are greater than the whole. A big part of the reason for this split seems to be to make it easier to realise that latent value but there are likely to be many more twists to that tale before it’s resolved.

 

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