TIM’s leadership has expressed dissatisfaction with the Italian government’s initial purchase proposal for its Sparkle subsea cable division, prompting CEO Pietro Labriola to seek improved terms. The decision follows a recent bid by the Ministry of Economy and Finance, which has been deemed inadequate by TIM’s board of directors. Amidst ongoing discussions about the board’s composition, the focus has swiftly shifted back to negotiations, underscoring the complex nature of the transaction involving Sparkle.
The specifics of the government’s offer remain undisclosed, but the crux of the matter appears to revolve around financial valuation and the deal’s structure. TIM is exploring a scenario where it would retain a stake in Sparkle for a certain period while supporting the strategic plan’s execution, a slight shift in stance suggesting a firmer intention compared to previous negotiations.
The valuation gap is significant, with reports suggesting that TIM values Sparkle at over €1 billion, contrasting with the state’s offer, which, even after an increase, falls short of TIM’s expectations. A revised deal structure, possibly allowing TIM to maintain partial ownership, could provide a pathway to reconciling these differences.
As negotiations continue, Sparkle has not let the uncertainty affect its operational progress, marking its entry into the Iraqi market by opening a new point of presence in Erbil in collaboration with Novel Point. This expansion reflects Sparkle’s ongoing commitment to enhancing its international network services.