Fastweb exits network company: sold its 4.5% stake in Fibercop to Kkr

Fastweb's adventure in Fibercop, the former monopolist's secondary network company owned 58% by Tim, 37.5% by Kkr and 4.5% by Fastweb itself, comes to an end.

Swisscom's subsidiary in Italy announced that it has reached an agreement with Optics Bidco, a subsidiary of Kkr, to sell its stake. Kkr will acquire all the shares held by Fastweb in Fibercop for a cash consideration of EUR 438.7 million. A value - explains a Fastweb note - in line with the pro rata price paid by Kkr to Tim for its stake (EUR 1.8 billion in 2020) with the transaction remaining subject to the completion of the NetCo transaction conducted by Kkr whose closing is expected in Q3 2024.

For Fastweb, the participation in the Fibercop transaction stemmed from the Flash Fibre operation: the wholesale JV owned 80% by Telecom Italia and 20% by Fastweb, whose business plan envisaged connecting around 3 million residential units in Italy's main 29 cities with Ftth technology by 2020, with 0.9 billion capital invested at the end of 2019.

As Intermonte points out, this move goes in the direction of strengthening "NetCo's positioning as a wholesale-only operator, with no more shareholding links with telephone operators, and favouring competition on an equal footing among retail operators (thus also benefiting TIM's ServCo). The sale eliminates in fact the last element of vertical concentration between NetCo (as network provider) and Fastweb (as reseller), but also horizontal concentration between NetCo and Fastweb, both network operators and competitors in the wholesale market'.

Also to be considered is the economic contribution, which in all likelihood pushed Swisscom in the direction of monetising in view of the EUR 8 billion outlay for the acquisition of Vodafone Italia (closing deal expected by Q1 2025).