KKR, CVC explore a joint bid for Telecom Italia

December 13, 2021

KKR (NYSE:KKR) is considering teaming up with CVC Capital Partners in its bid for Telecom Italia (OTCPK:TIIAY) (NYSE:TI.A), a move that would split the financial burden for Europe's largest leveraged buyout between the two private equity giants, Bloomberg reports, citing people with knowledge of the matter.

KKR (KKR) made an offer, valued at EUR 10.8B ($12B), for the Italian telecom company earlier this week, and was said to be evaluating a higher offer.

CVC was exploring an acquisition of Telecom Italia (OTCPK:TIIAY) for several months, the people told Bloomberg. The two private equity companies are still considering the pros and cons of teaming, and a joint proposal isn't assured.

Bloomberg also reported that Advent International, which had been in talks to team up with CVC on a potential bid, isn't eager to proceed because of the complicated nature of the deal and the Italian government's perceived support for the KKR (KKR) bid.

KKR (KKR) took a minority stake in Telecom Italia 's (OTCPK:TIIAY) last-mile network in 2020 at the request of the Italian government.

Over the current book year the company from Milan's total revenue could be around 15.6 billion euros (consensus estimates). This is slightly lower than 2021's revenue of 15.81 billion euros.

Historical revenues and results Telecom Italia plus estimates 2021

The analysts expect for 2021 a net profit of 575 million euros. The majority of the analysts expects for this year a profit per share of 3 cent. The price/earnings-ratio is then 14.67.

For this year most of the analysts expect a dividend of 1 cents per share. The dividend yield is then 2.27 percent. The average dividend yield of the telecommunications companies is a relatively high 4.01 percent.

Telecom Italia 's market capitalization is based on the number of outstanding shares around 6.63 billion euros. 18

At 16.36 the stock trades 0.34 percent higher at 0.44 euros.

Historical stock prices Telecom Italia

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