ROZZANO, Italy: This file photo shows the logo of Italian telecommunications company Telecom Italia (TIM) at the company’s headquarters in Rozzano, south of Milan. – AFP

MILAN: Shares of Telecom Italia (TIM) soared yesterday after receiving a “friendly” buyout offer from US private equity fund KKR valuing the operator at around 10.8 billion euros. Shares in Italy’s largest telecom rose as high as 0.45 euros on the Milan bourse, up almost 29 percent from Friday’s closing price. The public tender offer by New York-based Kohlberg Kravis Roberts regards the entire share capital of the company. TIM said the offer would be for an initial 0.505 euros a share.

Italy’s economy ministry saluted the interest by KKR as “positive news for the country” in a statement Sunday and said a working group would be formed to study the matter. The ministry said it was necessary to ensure that such a project would be compatible with the rollout of ultra-wideband in the country. Any sale would need the approval from government stakeholders, as TIM’s network is considered a national strategic asset.

TIM, which called an emergency meeting of the board to discuss the offer on Sunday, said the proposal was subject to around four weeks of due diligence and would require the backing of holders of least 51 percent of both ordinary and savings shares. KKR already has a 37.5 percent stake in FiberCop, a joint venture with TIM and Italian internet provider Fastweb to provide fiber optic broadband across Italy.

The takeover proposal comes amid news reports that shareholders-the largest of which is France’s Vivendi-are putting pressure on TIM’s top management following disappointing company results. TIM would also require clearance by Italian government stakeholders. “The indication of interest was qualified by KKR as ‘friendly’ and aims at obtaining approval by TIM’s directors and support by the company’s management,” the statement said. KKR already has a 37.5 percent stake in FiberCop, a joint venture with TIM and Italian internet provider Fastweb to provide fiber optic broadband across Italy.

A spokesman for Vivendi had earlier denied it was in discussions with any funds, including CVC, which had also been named in speculation about TIM’s future. “Vivendi is a long-term investor in Telecom Italia and has been so since the beginning. Vivendi denies strongly having had any discussions with any funds, and more specifically with CVC,” he said. “Vivendi reiterates its desire and willingness to work alongside Italian authorities and public institutions for the long-term success of TIM.” – AFP