Activist investor Singer holds 5.74% of Italian incumbent and could boost his position further

The sale of TIM’s fixed network assets could be on the cards if activist investor Paul Singer has his way.

Singer’s Elliott Capital Advisors holds 5.74% of TIM, formerly known as Telecom Italia, according to an update from Italian market watchdog Consob on Wednesday.

Singer is going head-to-head with TIM’s major shareholder Vivendi on company strategy and, according to press reports, could increase his stake in the telco further in order to strengthen his position.

As it stands, Elliott is studying a proposal for the spin-off and flotation of TIM’s fixed network by the end of next year, with a view to decreasing the telco’s stake in the fixed asset to a minority position, Bloomberg reported on this week, citing unnamed sources. The spun-off company would take with it around €10 billion in TIM debt and several thousand employees, the sources said.

Elliott is pushing for an overhaul of TIM’s board, proposing replacing chairman – and Vivendi CEO – Arnaud de Puyfontaine and five other directors, the newswire said, calling for independent board members to replace them. TIM’s annual shareholder meeting next month will provide the stage for the confrontation between Elliott and Vivendi, it said.

noted that there is another plan afoot at TIM that would see the telco spin off its network assets but retain full control. Its sources said the operator will submit its plans to regulator Agcom by the end of this month.

Control of TIM has been a hot topic for a number of years. Vivendi, which holds close to 24% of the operator, became TIM’s largest single shareholder in mid-2015 and has added to its stake in the intervening period, raising questions over its plans for the company. Meanwhile, Rome took exception to the move and late last year exercised its golden power to protect national assets, such as the network.