Sources suggest Italy’s new government wants control of TIM’s wholesale submarine cable network business, considering it a strategic national asset
Back in October, Giorgia Meloni took over as Italian Prime Minister, a move that had major implications for beleaguered incumbent operator TIM.
For over two years now, the Italian government has been pressuring the operator to merge its fixed network assets with those of its rival Open Fiber, aiming to create a single national network.
All of this was taking place against a backdrop of TIM’s relatively poor performance in a competitive market, resulting in a change of leadership at the start of the year.
The Meloni administration, however, has been far more forthright in their support of a single network plan, so long as the government, via investor state lender Cassa Depositi e Prestiti (CDP), could secure control
Today, according to a report from Reuters, the government is in fact considering going one step further, with sources suggesting that the government is now seeking control of TIM’s submarine cable unit, Sparkle.
Sparkle owns and operates various submarine cable systems in the Mediterranean and across the Atlantic, its networks spanning over half a million kilometres.
According to the report, the government is seeking control of Sparkle due to the sensitivity of data it carries over these networks, with the networks being considered a major strategic asset for the nation.
In total, Sparkle could be worth around €1 billion.
It is worth noting that the submarine cable unit is not the only one of TIM’s assets that could be on the chopping block.
Earlier this week, TIM CEO Pietro Labriola said at an industry conference that the company “cannot solve Telecom Italia’s debt issue organically”, saying that they needed to “sell assets”. At the same time, the government announced that it had initiated talks with TIM’s largest investors, CDP and Vivendi, to explore “market-friendly options” for the operator.
How would the sale of Sparkle to the Italian government reshape submarine cable network dynamics in the Mediterranean? Join the experts in discussion at the upcoming Submarine Networks EMEA conference early next year