By Elvira Pollina
ROME (Reuters) – U.S. investment firm KKR will likely offer remedies next week in an attempt to secure EU antitrust approval to buy Telecom Italia’s (TIM) fixed-line access network, a person familiar with the matter said on Wednesday.
KKR wants to acquire TIM’s domestic network for up to 22 billion euros ($23.87 billion), making the Italian telecoms group the first in a major European country to divest its landline grid.
The European Commission is now examining the deal, with a decision due by May 30. KKR has until May 23 to offer remedies or risk the EU competition enforcer opening a four-month long investigation following the end of its preliminary review.
KKR is ready to offer remedies to allay EU antitrust concerns in an effort to get the green light during the EU’s initial review, the person said.
Other people said remedies that allow fair and reasonable access to the network and maintain existing contracts that were put in place after the creation of FiberCop, Telecom Italia’s last-mile grid unit, could address regulatory concerns.
Other possible remedies include assurances that NetCo, a venture comprising TIM’s fixed access network, will continue to offer rivals direct access to the fibre using their own equipment, they said.
KKR is expected to sooth concerns linked to the volume discount it granted TIM, which would remain the main customer of the newly created wholesale network operator, the people said.
KKR declined to comment.
The Commission’s main concerns focus on the impact of the deal on the wholesale market, other people with direct knowledge of the matter told Reuters last month.
TIM’s landline network covers nearly 89% of the country’s households and its fibre and copper cables stretch over 23 million km (14.3 million miles). The sale is part of a government-backed plan aimed at cutting debt and reviving the group.
($1 = 0.9217 euros)
(This story has been refiled to fix the day of the week to Wednesday, not Tuesday, in paragraph 1)
(Additional reporting by Foo Yun Chee; Editing by Kirsten Donovan)
