ROME / MILAN (Reuters) – Italy is considering a cheaper route to win control of broadband operator Open Fiber, three sources with knowledge of the matter said on Wednesday, as it looks set to play a guiding role to improve connectivity across the country.
Open Fiber is jointly owned by Italy’s largest utility, Enel, and state lender Cassa Depositi e Prestiti (CDP).
Enel has been in talks to sell up to 50% of the fiber infrastructure group to fund Macquarie Australia for 2.65 billion euros ($ 3.11 billion) since last year and a deal is expected to be reached in June.
The original scheme envisioned CDP buying 10% of Open Fiber from Enel and negotiating governance rights with Macquarie to secure control.
But disagreement over the value of Open Fiber has prompted the two sides to discuss alternative routes, the sources said.
Under the new scheme under discussion, Enel will sell all or part of its 50% stake to Macquarie, after which CDP will increase its stake to 51% through a capital increase, the sources said.
CDP and Macquarie declined to comment. Enel could not be reached for comment.
In this way CDP could save hundreds of millions of euros in winning control of the joint venture.
One of the sources said the talks were at an advanced stage, adding that Enel could maintain a small stake in Open Fiber.
The Italian government has previously championed CDP’s bid to win control of Open Fiber as part of a broader plan to combine it with the former landline assets of the Italian Telecom (TIM) telephony monopoly.
But ministers from Mario Draghi’s new government have cast doubt on the project, saying Rome is reviewing its options.
TIM, of which CDP is the second-largest shareholder behind French media company Vivendi, has repeatedly said it will not agree to own less than 50% of any single network company – something that could spark regulatory issues.
A fourth source said the industry ministry is studying other options including a co-investment scheme to allow operators to build their networks in some areas and reach commercial agreements in others.
The Draghi government has put digital infrastructure at the heart of its agenda and is relying on a grant from the European Recovery Fund to accelerate fiber-optic rollout.
Draghi has not said whether his administration intends to implement an integrated network project but the Ministry of Finance has meanwhile pressed for plans to ensure CDP has control over Open Fiber, one of the sources said.
Reporting by Giuseppe Fonte in Rome, and Elvira Pollina and Stephen Jewkes in Milan; Edited by Matthew Lewis