Telecom Italia deal faces strong opposition

2 Apr 2003

Institutional investors are lining up in their droves to launch a legal challenge to demand better terms in the merger of Italian telco Telecom Italia with Olivetti. The PTO has offered to swap seven shares in Olivetti, the heavily indebted holding company partly owned by Telecom Italia chairman Marco Tronchetti Provera, for each of its own shares. Olivetti would also assume up to EUR9 billion (USD9.8 billion) more in debt to satisfy a legal requirement and pay cash to Olivetti shareholders. However, the proposal has sparked a wave of criticism, with some openly calling the offer a ‘mugging’.