Reuters logo
Enel expected to get nod to buy Metroweb on Wednesday-sources
May 24, 2016 / 6:46 PM / 2 years ago

Enel expected to get nod to buy Metroweb on Wednesday-sources

MILAN (Reuters) - Italian state lender Cassa Depositi e Prestiti is set to pick Enel (ENEI.MI) as the buyer of fibre-optic group Metroweb at a board meeting scheduled on Wednesday, three sources familiar with the matter said on Tuesday.

Last week, Italy’s biggest utility Enel made a formal offer for Metroweb valuing it at 806 million euro ($898 million). There is also a rival all-cash bid from Telecom Italia (TLIT.MI) of 814 million euros.

“CDP’s choice has been made and is in favor of Enel”, one of the sources said.

A second source said a decision had been made, adding that CDP would give a mandate to its CEO to proceed with exclusive talks with Enel.

One of the sources said Enel had sent a revised offer to Metroweb, raising its offer to 814 million euros to match the Telecom Italia bid. “It seems the offer is binding,” the source said.

Metroweb, which has broadband networks in Milan, Turin and Genoa, is owned by CDP and Italian infrastructure fund F2i which in turn has the state lender as one of its shareholders.

State-controlled Enel set up Enel Open Fiber (EOF) earlier this year to manage its fiber ambitions. It plans to invest 2.5 billion euros to bring ultra-fast broadband into peoples’ homes using its existing power network.

Rolling out a high-speed Internet network is a key plank of Prime Minister Matteo Renzi’s reformist agenda.

Enel’s offer is expected to involve a merger of Metroweb and EOF and is expected to part cash and part shares. There would be a capital increase at EOF, allowing CDP and F2i to become investors.

    Enel, which controls Spanish utility Endesa (ELE.MC), could have more than 50 percent of EOF depending how the deal is structured, two of the sources said.

    But a third source said Enel could end up holding around 40 percent of EOF while CDP and F2i would hold respective stakes of 40 percent and 20 percent.

    Another source said the idea was for Enel’s stake in EOF to remain below 50 percent and that if it did have a majority stake initially the aim was to go below half before the end of next year so it did not have to consolidate any debt.

    Enel has previously said it could replicate its broadband plans in Italy in other countries where it has power distribution networks.

    CDP was not immediately available for a comment.

    Reporting by Stefano Rebaudo, Silvia Aloisi, Stephen Jewkes. Editing by Jane Merriman

    0 : 0
    • narrow-browser-and-phone
    • medium-browser-and-portrait-tablet
    • landscape-tablet
    • medium-wide-browser
    • wide-browser-and-larger
    • medium-browser-and-landscape-tablet
    • medium-wide-browser-and-larger
    • above-phone
    • portrait-tablet-and-above
    • above-portrait-tablet
    • landscape-tablet-and-above
    • landscape-tablet-and-medium-wide-browser
    • portrait-tablet-and-below
    • landscape-tablet-and-below