TIM looks to buy BT data centres in Italy

The information comes from Reuters, which cites a pair of unnamed sources as saying that TIM has submitted a non-binding bid for the remainder of BT Italia left behind after the UK incumbent sold off much of its business in the market over the past few years.

The sources say that TIM is looking for a payout of around €100 million from BT in order to take on the assets.

The Italian incumbent already has links with BT having agreed to acquire its business units serving public administrations and SMEs in Italy back in 2020. The deal – of undisclosed value, but likely not a major transaction, given the relatively small size of the operations in question – closed six months later.

BT's decision to divest its customer-facing Italian operations came in the wake of an accounting scandal that broke around eight years ago and triggered major changes for the UK incumbent. It was also linked to a reshaping of the BT Global business, which now looks to be on the block following the arrival of new CEO Allison Kirkby at the start of this year.

As well as offloading a pair of Italian business units to TIM, BT also completed the sale of Italian ICT company BT Enìa to Retelit in January; the deal included fibre network and one data centre.

According to Reuters, the remaining BT Italia business claims a further four data centres and backbone network. It could prove attractive to any number of players in the Italian market, and indeed that appears to be the case; TIM is not the only name in the frame.

The newswire claims Retelit has also thrown its hat into the ring, as has Italian private equity firm Nextalia. Meanwhile, a couple of months ago Bloomberg also named Nextalia as a likely bidder, alongside Spain-based investment firm Asterion Industrial Partners.

There has been nothing official from any party, but we might have something concrete before too much longer. Reuters notes that binding bids are due by the end of this month.

The arrival of TIM as a potential bidder makes a lot of sense. All eyes are on the Italian incumbent in the wake of its NetCo networks business sale to KKR in July. While much of the focus has been on its consumer operations, TIM has also made it clear that it is keen to build up its enterprise unit. It aims to grow revenues by concentrating on the cloud market in particular, looking at partnerships with global operators and spearheading Italy's cloud hub project, the Polo Strategico Nazionale.

The addition of more data centre capability plays into that goal, so doubtless TIM will be keen to see off the competition. But much will depend on the terms BT is willing to accept. And given the way its other Italian divestments played out we may not be privy to final details.