MILAN (Reuters) -Sweden’s EQT Infrastructure will take a majority stake in Wind Tre’s Italian telecoms network after agreeing a deal with Hong Kong’s CK Hutchison valuing the business at 3.4 billion euros ($3.74 billion), including debt, the groups said.
CK Hutchison, the owner of Wind Tre, will own the remaining 40% of the new infrastructure company, which will be led by Benoit Hanssen, currently co-CEO of Wind Tre.
EQT declined to say how much it was paying for its equity stake.
The business will own and operate Italy’s largest mobile network and a portfolio of assets, including radio antennas, base stations and associated contracts.
Like other telecoms operators in Italy, Wind Tre has been grappling with aggressive price competition that eroded earnings, just as these companies face a heavy outlay to build a fifth-generation mobile grid.
The Italian mobile network required investment and expansion over the coming years to meet increasing demand, EQT said.
Wind Tre will be an anchor customer, signing a long-term service agreement with the infrastructure company, which would also provide wholesale connectivity to other operators.
CK Hutchison, the Hong-Kong telecoms-to-ports conglomerate part-owned by billionaire Li Ka-shing, previously sold off Wind Tre’s telecoms masts in Italy to specialist operator Cellnex
Wind Tre, which is the largest mobile operator in Italy when excluding machine-to-machine contracts, will now focus on serving its retail and business customers in the country.
It is likely to shift some 2,000 workers out of a total 6,500 workers in Italy into the network venture, sources have previously told Reuters.
Italy made upgrading its communications infrastructure a central part of its post-COVID-19 multi-billion recovery plan.
CK Hutchison and Britain’s Vodafone are close to agreeing a merger of their UK telecoms businesses, two sources said last week, in a deal that would create the country’s biggest mobile operator.
($1 = 0.9084 euros)
($1 = 0.9084 euros)
(Reporting by Riya Sharma in Bengaluru Elvira Pollina in Milan and Supantha Mukherjee in Stockholm;Writing by Keith WeirEditing by Savio D’Souza and Sharon Singleton)