By Elvira Pollina
MILAN (Reuters) - Telecom Italia (MI:TLIT) (TIM) and Vodafone (LON:VOD) have completed the sale of an 8.6% combined stake in Italy's biggest mobile towers company INWIT as part of efforts to cut debt, the companies said.
The placement of shares in the business in which Vodafone and TIM merged their mobile towers infrastructure was announced late on Wednesday, catching analysts by surprise after TIM's chief executive said last month that the two groups had been in talks with funds over a planned sale of a 25% stake in INWIT.
Sources had said that a consortium led by French private equity group Ardian was poised to buy the stake but later indicated that talks had been slowed by the outbreak of the coronovirus emergency..
With INWIT shares having rallied by 30% this year, market prices could had been more attractive than funds' valuations, said Domenico Ghilotti, analyst at broker Equita.
TIM and Vodafone said they had raised about 400 million euros (349.51 million pounds) each ($433 million) by each selling a 4.3% stake at 9.60 euros per share - nearly 11% below INWIT's closing price on Wednesday.
In their annual reports for 2019, TIM and Vodafone reported net debt of 28.2 billion euros and 27 billion euros respectively.
After the sale, which would lift INWIT's free float by more than a third, Vodafone and TIM will each hold 33.2% of the towers business, down from an initial stake of 37.5%, and keep joint control.
Vodafone and TIM agreed to stick a 90-day lock-up period on their remaining shares, they said in their statements.
BofA Securities, Banca IMI (LON:IMI), Goldman Sachs (NYSE:GS) International and UBS acted as joint global coordinators on the offer.
On Thursday shares in INWIT fell 10.6% to 9.59 euros by 1045 GMT. Vodafone and TIM shares were up 1.4% and 2.9% respectively.