Chief executive Marco Patuano said the operator had received an unsolicited offer for its 22.7 percent stake in Telecom Argentina and planned to sell, with Argentina's media regulator later confirming that the bidder was investment firm Fintech Advisory, which already holds shares in Telecom Italia's Argentine unit. Patuano said that the offer received was around USD 1 billion (EUR 745 million). Telecom Italia expected to raise a further EUR 2 billion from the sale of over 17,000 mobile phone towers in Italy and Brazil, as well as the TI Media Broadcasting unit.
Patuano’s Telefonica-backed strategy represents an effort to pare debt and avoid further credit downgrades after Moody’s cut Telecom Italia’s rating to junk in October. However, Moody’s warned that the EUR 1.3 million convertible bond would not help the company’s rating for now since it would not be considered equity until it had converted to shares in 2016. With the bond Telecom Italia avoided a straight capital hike of up to EUR 2 billion, which had been a widely expected option.
The company’s current strategy does not involve a sale of its prized Brazilian unit, mobile operator TIM Brazil, although sources familiar with the matter told Reuters that Telefonica was hoping to sell the unit in the second half of 2014. TIM Brazil is the second largest mobile operator in the country behind Telefonica's Vivo unit. Patuano stressed that Brazil remained a core asset but added "you can never say never".
In the domestic market, Telecom Italia pledged to target around EUR 9 billion in capital expenditures between 2014 and 2016, including major investments in high-speed fibre optic and 4G networks.
