TIM Group | TIM: Define the perimeter of the potential separation of static network (NETCO) from services (SERVICECO) to overcome the vertically integrated model

The Board of Directors of TIM, which met yesterday under the chairmanship of Salvatore Rossi, authorized the CEO, Pietro Labriola, to carry out all activities beneficial to achieving the strategic goal of overcoming vertical integration and reducing the level of debt. The Company by transferring and enhancing certain assets of the Group. Any options will be presented to the Board for appropriate deliberation.

Management outlined to the Board a transformation plan based on the awareness that the group operates in a highly competitive market and one of the most stringent regulatory restrictions in Europe.

The plan provides for the separability of fixed network infrastructure assets (NetCo) from services (ServiceCo with TIM Consumer, TIM Enterprise and TIM Brasil) and spells out the market context, periphery, and strategic activities of each entity, as well as the ways in which they will be able to compete in their reference markets In order to generate more value.

In more detail, the plan provides for the following distribution:

  • we are: includes The fixed, primary and secondary network and domestic and international wholesale activities (Sparkle). Netco may represent the first case in Europe to create a pole of fiber network infrastructures and technologies available to the entire market and with a wide presence throughout the national territory. It will focus on the wholesale market with the mission of further accelerating the deployment of the fiber network, benefiting in the medium-long term from investment cycles and typical relative returns of the infrastructure market.
  • Servesco. They include TIM Enterprise, TIM Consumer and TIM Brasil
    • TIM Foundation. All inclusive Business activities in the digital enterprise and corporate market Noovle, Olivetti and Telsy. Includes data center assets. By taking advantage of a leadership position in general management and major clients and on one sale offer Butt to tip Unique and distinctive, aiming to earn shares in a growing market thanks to the push towards digital services. approach from tech companyincreasingly, from an organizational point of view as well, to offer a comprehensive who – which You will fully exploit the uniqueness of the group’s skills and assets, driven by the trends of cloud, Internet of Things and cybersecurity.
    • Tim consumer. focus inside All fixed and mobile businesses in the retail marketplace for consumers and small and medium businesses (SMB). Includes mobile network assets and service platforms. A deep reorganization of its activities, on the basis of simplification, will be the main element for improving performance.
    • Tim Brasil. player A reference in the South American telecom market, And it will continue its march towards the “next generation of communications”, which has already made it possible to double shareholder bonuses. Following the acquisition of Oi Group’s mobile business, revenue growth, Ebitda and cash generation is expected to accelerate, with strong trends.

This business plan will allow to improve operational performance with the specific economic and financial focus of each entity and attract new industrial and financial partners, allowing to accelerate innovative processes and develop an offer on new business geared towards digital transformation.

Moreover, with the new regulation envisaged by the plan, it will be possible to take full advantage of the opportunities offered by digital transformation and at the same time achieve a sustainable capital structure, thanks to an important improvement path in the financial situation that provides for the deconsolidation of the fixed network and the potential entry of new minority shareholders At TIM Enterprise.

Rome, 7 July 2022

Leave a Comment