In what could be a blow to the European ambitions of Egypt’s Naguib Sawiris, Telecom Italia says it will not bid for GVT, Vivendi’s Brazilian phone business, according to Italy’s Il Sole 24 Ore newspaper.
Billionaire Sawiris this week confirmed that he would attempt to buy a stake in the Italian incumbent through a cash injection of €3 billion ($3.9 billion), but Telecom Italia (Rome, Italy) had previously hinted at a lack of interest unless it decided to proceed with a bid for GVT (Curitiba, Brazil).
What’s more, in making his bid Sawiris valued Telecom Italia at about €0.70 per share, its market price, while shareholders reportedly believe the company is worth €1.50 a share.
According to Il Sole 24 Ore, Vivendi (Paris, France) received four preliminary non-binding offers for GVT before its deadline passed, but none was from a telecoms operator.
Vivendi is seeking €7 billion for the asset, reports Reuters, and none of the four bidders reportedly offered more than €6 billion.
Speaking at a Morgan Stanley conference earlier this month, Marco Patuano, Telecom Italia’s chief operating officer, appeared to make a sale of shares to Sawiris contingent on the operator’s takeover of GVT.
The indebted Italian company would need additional funds to finance an acquisition of GVT, presenting an opportunity to the Egyptian tycoon.