|
Mobile & Wireless
Telecom Italia Buys AOL Germany
EUR675 Million Offer Reaffirms New Strategy, Says Italian Incumbent
by Ken Wieland
Telecom Italia has announced an agreement with Time
Warner to buy its AOL Germany Internet access business for
€675 million in cash.
For its money, Telecom Italia gets access to 3.2 million
subscribers in Germany, including nearly two million
broadband subscribers. AOL is to provide services and content
to the Italian incumbent’s customers in Germany, made
available via a jointly-branded web portal with Telecom Italia.
Riccardo Ruggiero, CEO of Telecom Italia, said in a
statement: “This acquisition marks a further step in Telecom
Italia’s strategy of broadband services and content delivery at
an international level.”
But this, of course, is an entirely new strategy for Telecom
Italia.
The Italian incumbent has had a tumultuous time in recent
days following its statement last week that it intended to
break up the group and sell its mobile division, Telecom
Italia Mobile (TIM).
The sale of TIM is an embarrassing U-turn for Telecom Italia
as only last year – because it saw the wind blowing towards
fixed and mobile converged services – it reintegrated TIM
back into the Group claiming that it could achieve better
synergies and cost savings that way.
However, because TIM has debts of over €40 million, the decision
to sell TIM was taken – something which the Italian
government and Romano Prodi, the prime minister, have
reportedly opposed on the grounds that TIM could fall into
foreign hands.
Telecom Italia’s dispute with the government led to the
resignation of Marco Tronchetti Provera, Telecom Italia’s
chairman, last Friday.
As it stands at the moment, Telecom Italia has around nine
million broadband subscribers in Europe with a presence in
France and the Netherlands, as well as Germany and Italy.
Telecom Italia and Time Warner are expected to close the
deal on AOL Germany within four to six months following
regulatory approval.
|
