AT&T will partner Italian to achieve TI goal – report

AT&T has told a newspaper that it is open to Italian partners, in its proposed purchase of Telecom Italia.

The American giant has, thus far, partnered Mexico’s America Movil but has stirred deeply protectionist views on the future of the Italian incumbent.

Earlier this week, Italian ministers rounded on the proposal claiming it was bad for Italy because it gave foreigners control over the last remaining Italian-owned telecoms player. Three of the country’s other telcos are owned by foreign companies while FastWeb, Italy’s second largest fixed-line firm is being bought by Swisscom.

“We are absolutely ready to take into consideration the interests of Italian industrial and financial partners,” Rick Moore, managing director for corporate development at AT&T, told Corriere della Sera newspaper.

Addressing Italy’s concerns, Moore is quoted saying: “There’s no reason to think that Telecom would lose its Italian identity … we want to establish a strong collaboration with Telecom for a long-term industrial strategy.

He added that TI’s workers, worried about possible job cuts “have no reason for concern”.

Analysts from Ovum said: “Ownership and control of TI is a political football in Italy and some politicians have already expressed their dislike for a ‘non-Italian’ solution. The intertwining of business and politics is not a great omen for success. Italian investment Bank Mediobanca and insurer Generali – already minority shareholders – do have a right of first refusal in the transaction, so they could easily step in and put AT&T’s and America Movil’s position at risk, but they should pay a price premium that maybe they are not ready to pay today.

“Over the past year the company has been in turmoil with strategic u-turns and resignations, so doubts exist on whether it can take advantage of this opportunity. On balance we are not convinced the upside possibilities outweigh the downside…”

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