Olivetti SpA's record-breaking 117 trillion [T] lire ($97.2 billion) hostile takeover bid for Telecom Italia SpA has achieved success, with 51.02 per cent of Telecom Italia shareholders accepting the offer, Olivetti confirmed yesterday.
Olivetti chief executive officer Roberto Colaninno reacted calmly to the victory, which emerged late Sunday night, telling reporters at a press conference in Milan he was satisfied but not euphoric.
"I'm pleased, but nothing more and I know what awaits me now," he was quoted as saying by the ADN-Kronos news agency. "I am glad that the passage of control will take place between gentlemen rather than in the law courts," he said.
Colaninno is due to meet defeated Telecom Italia CEO Franco Bernabe to discuss the handover of power at Italy's incumbent telecommunications operator.
Failure to get more than 50 per cent of Telecom Italia's shareholders to accept the bid would have exposed Olivetti to a potential legal battle, since Telecom Italia's statute barred individual shareholders from holding more than 3 per cent of the company unless they assumed outright control.
In the end, the Olivetti offer was accepted by a majority of international investors in Telecom Italia, almost all the Italian investment funds, around half the private investors and all the members of the core of long-term investors with the exception of Credit Suisse, the Milan business daily Il Sole 24 Ore reported. The shares tendered were worth a total of 59.682 trillion lire, the paper said.
The boards of Olivetti and Tecnost SpA, an Olivetti group subsidiary that manufactures automated betting machines and which was chosen as the vehicle for the bid, met yesterday and decided to accept the shares tendered and to proceed with the offer, having secured the prior agreement of the banks supporting the offer, Olivetti said in a prepared statement.
"The boards also noted that approval from the competition authorities, as foreseen in the offer document, had been received," the statement said.
Colaninno, who said he intended to take the post of CEO at Telecom Italia, indicated he was prepared to reconsider a possible alliance between the Italian telecomms carrier and Deutsche Telekom AG. During the takeover battle, the Olivetti CEO condemned Telecom Italia's defensive strategy of merging with Deutsche Telekom as a sellout to the Germans and Deutsche Telekom CEO Ron Sommer said he would not be willing to cooperate with the Olivetti management in the event their bid was successful.
In an interview due to be published today by the German newspaper Welt Am Sontag, quoted by the Italian news agency ANSA, Sommer said he still believed the planned merger offered advantages both to the two companies and to the European economy.
Colaninno welcomed Sommer's change of heart. "I have always said that I was not opposed to discussing all opportunities. I am happy that Mr Sommer has also changed his mind," he told the Milan press conference.
The takeover could still theoretically be blocked by the Italian government using its golden share powers, but Finance Minister Vincenzo Visco indicated yesterday that was unlikely. "I don't think that would be appropriate," he told the ANSA news agency. "This affair has been conducted in a transparent manner and in accordance with the rules that we established," he said.
Not everyone welcomed the Olivetti victory, however.
"Today is a black day for Italian finance and for the economy because we have seen the possibility for a group of speculators to seize control, with scarce financial resources and many debts, of Italy's biggest industrial group with a value of more than 100 trillion lire," Nerio Nesi, economic spokesman for the Party of Italian Communists, told ADN-Kronos. "I have read that the employees are scandalised and worried, and they are right to be so, because we will see the ruin of Telecom Italia."