As part of the merger between H3G and Wind, the French group Iliad has reached an agreement with Hutchinson and Vimpelcom to purchase their frequencies and towers in Italy. This is one of the remedies proposed to the European Commission which is examining the integration between the two telecommunications companies. This was announced in a note by Iliad, specifying that the agreement is subject to the green light of the Community executive as well as the same transaction between Wind and H3G, for which a decision is expected by 8 September.
The group, headed by Xavier Neil and which controls the transalpine operator Free, will thus become the fourth operator on the Italian market. According to the French newspaper Les Echos, Iliad's total investment in Italy will amount to around 1,5 billion euros.
The package of assets purchased will allow Iliad to offer competitive mobile services and become the fourth mobile operator with nationwide coverage. The agreement includes several points: a portfolio of 3G and G frequencies for an amount of 450 million euros for which a gradual payment is foreseen in the period 2017-19; the commitment to acquire several thousand macro sites in densely populated areas made available by Wind/H3G or by third parties; the commitment to reach an agreement on the coverage of rural areas; an agreement relating to roaming of the integrated network for a period of five years renewable for a further period of 5 years on the initiative of Iliad.
The agreement therefore represents "a unique opportunity" to enter the Italian telecommunications market in its digital transition phase. Iliad, the note continues, intends to carry out a 5-7 year investment plan in line with the commercial development of the project financed entirely through the group's liquidity and without this posing a threat to the group's financial position.
Furthermore, Iliad was informed by Xavier Niel, its majority shareholder, "that as of today does not hold, directly or indirectly, any participation in the voting rights or in the capital of Telecom Italia and has only a marginal economic interest (less than 25 million euros) which will be sold in the next few weeks”.
