Mark Yagalla • 12 Comments
Fri, Mar. 4, 4:30 PM
- With Vivendi (OTCPK:VIVHY -0.4%) throwing its weight around in a new strategy -- buying up shares of game makers Ubisoft and Gameloft, and of Italian communications incumbent Telecom Italia (TI +2.8%) -- the heat is on TI chief Marco Patuano to get on board the strategy that Vivendi tycoon Vincent Bollore is pursuing.
- Shares of TI are up 10.5% since Wednesday's strategy meetings between Patuano and Vivendi execs, among speculation that change is coming whether Patuano continues to lead or not.
- A 26-year veteran of the company, Patuano has increased spending on network infrastructure but has had to navigate a tricky mix of shareholders and government. Italy considers the company of strategic interest to the state, potentially complicating a move in from a French billionaire.
- Tensions were present from the time Vivendi first took its stake, and they may be intensifying as Vivendi's stake grows. Patuano struck the deal to sell off TI's control of Telecom Argentina (TEO +0.6%) and spun off its cell towers in a series of moves to address debt, but "Vivendi wants to sell Brazil" -- TIM Participaçoes (TSU +4.8%), the company's Brazilian unit -- "and Patuano does not" since he sees it as strategic, a source tells Reuters.
- Vivendi has built its stake to 23.8%, but has just four of 17 board members at present.
Oct. 15, 2015, 6:06 PM
- Argentine telecom regulator Aftic has rejected the bid by Fintech Group -- led by Mexican financier David Martinez -- to buy a controlling stake in Telecom Argentina (TEO -0.2%) from Telecom Italia (TI +3.5%).
- Aftic unanimously rejected the Fintech proposal on grounds that it couldn't guarantee normal functioning of a telecommunications company.
- Martinez had proposed taking a 68% stake in Sofora Telecomunicaciones, the indirect controller of Telecom Argentina. But regulators noted he had incorporated Fintech in Delaware less than a month before TI accepted his bid.
- After coming to agreement with Fintech -- effectively acquiring TI's 22.7% indirect stake in Telecom Argentina for $960M -- TI agreed to give Martinez 30 months to complete the deal, but he continued to fail at the regulatory level.
Sep. 28, 2015, 10:25 AM
- Telecom Argentina (NYSE:TEO) is off 4.9% as Goldman Sachs cuts its rating on the shares to Sell.
- The firm's Vera Rossi cut Goldman's price target to $14, from $18. Shares had closed Friday at $14.93, implying 6% downside.
- Goldman expects a decline in revenue growth and margin contraction as contract users continue to disconnect over the next few years, and the related declines in SMS and interconnection revenues that come with that (as users shift to lower-ARPU prepaid service).
- Operating expenses could continue to rise amid inflation rates over 23%, the firm notes. “We expect to see annual margin declines resume in 2016 to 23.2% (~26% in 2014/15), as inflation driven opex growth (22% in 2016) is likely to surpass revenue growth, which we see slowing to 17.2% in 2016 (from 21.4% in 2015) driven by rising disconnections and falling SMS growth.”
- It cut EPS estimates for the next two years, to $1.79 from $2.10 in 2016, and to $1.50 from $2.11 for 2017. Shares of TEO are down 26.2% YTD.
Sep. 25, 2013, 1:25 PM
- At a parliamentary hearing in Rome, Telecom Italia (TI -4.8%) reiterated his opposition to a sale of the company's Brazilian and Argentine assets, at least over the near-term. Bernabe argued selling the units, responsible for 40% of TI's 2012 revenue, would hurt the carrier's international profile.
- TIM (TSU -4.8%), TI's Brazilian unit, is joining TI in selling off after rallying yesterday. A downgrade to Hold from Stifel could be contributing to the losses. Telecom Argentina (TEO +0.3%), in which TI owns an indirect 37% stake, is up slightly.
- Bernabe's remarks come a day after Telefonica (TEF +0.8%) announced a deal that could let it eventually take full control of holding company Telco and its 22.4% TI stake. Telefonica, whose Brazilian unit (VIV -2.9%) competes with TIM, is widely believed to be pushing TI to sell TIM to shore up its balance sheet and appease regulator Anatel (previous).
- Bloomberg reports Anatel would prefer TIM be sold in full rather than have its assets sold piecemeal. That could translate into a sale into a major foreign carrier such as Vodafone or AT&T, which in turn would spell tougher competition for Telefonica and fellow Brazilian carriers Oi (OIBR -9.6%), America Movil (AMX), and NII Holdings (NIHD +1.1%).
Aug. 13, 2013, 12:49 PM
- Shares of Telecom Argentina (TEO +8.1%) are up sharply, even though no news has hit the wires.
- 54.7% of TEO shares are owned by Nortel Inversora (NTL +7.6%), itself 68% owned by Telecom Italia (TI) and 32% owned by the Werthein Group. (20-F)
- One possible reason for today's jump is the potential of a sale by Telecom Italia of its 37.2% indirect stake in TEO, as the Italian giant contends with the threat of a credit downgrade. The beleaguered telco recently ruled out floating a stock offering as a means to pare its onerous €28.8B net debt load, and has nixed a number of other strategic alternatives.
Jul. 1, 2013, 5:30 PM
Feb. 28, 2013, 12:53 PM
Feb. 29, 2012, 3:13 PM
Spain's Repsol (REPYY.PK -5.6%) follows shares of its Argentine subsidiary YPF sharply lower on worries President Fernandez could announce greater intervention into the oil giant's operations on Thursday. The Argentina ETF: ARGT -2.4% - also taking a hit as YPF no doubt makes up a nice chunk of its holdings.| Feb. 29, 2012, 3:13 PM