MILAN, Italy-Control of Italy’s largest telecom company, Telecom Italia, has changed hands, with Pirelli, an Italian tire and cable company, and Edizione, the holding company for the Italian Benetton family, buying a 23-percent stake in Olivetti for about $6.1 billion. Olivetti owns 55 percent of Telecom Italia, which in turn owns 56 percent of mobile operator Telecom Italia Mobile.
The Italian companies purchased the stake from Bell, a Luxembourg-based holding company controlled by Olivetti and Telecom Italia Chief Executive Officer Roberto Colaninno. Colaninno, which gained control of Telecom Italia by spearheading a hostile bid in May 1999, will resign.
The price is an 80-percent premium over last week’s closing price for the shares held by Bell.
In 1999, Olivetti won a hostile $33 billion bid for 51 percent of Telecom Italia. Since then, Colaninno made several attempts to reduce Olivetti’s considerable debt of about $12.3 billion, but had been unsuccessful.
Enrico Bondi, former CEO of Montedison, will serve as a co-chief executive, along with Carlo Buora of Pirelli.
The Italian government owns a 3.4-percent stake in Telecom Italia and did not object to the deal.
