TIM’s share price rallied on news of the potential investment
Italy’s state lending fund, Cassa Depositi e Prestiti, could be set to increase its stake in Telecom Italia (TIM) to up to 10 per cent, according to a report by Reuters.
CDP’s board cleared the way for the Italian lender to increase its stake in TIM to a maximum holding of 10 per cent within the next 12 months.
TIM is currently locked in the grips of a boardroom battle between its biggest shareholder Vivendi and activist investor fund Elliott Management. Elliot currently controls the fragile balance of power in the TIM boardroom, since it succeeded in getting 5 of its members elected to directorship last year. Vivendi has subsequently called for an extraordinary shareholders’ meeting to be held in March to remove the Elliott backed directors from their roles.
CDP is controlled by the Italian treasury and the Italian government’s decision to up its stake in TIM is intended to calm the waters at the country’s biggest telco.
TIM’s shares rose 6 per cent on news of the increased investment from the Italian government. The company’s share price had been in steep decline in the wake of the boardroom tussle.
TIM’s share price stood at €0.58 as recently as the 27th November and had steadily fallen to €0.45 by the end of January. Today the company’s stock was trading at €0.49 per share.
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