Italy Would Welcome Egypt’s Sawiris as Telecom Italia Investor

The Italian government would welcome Naguib Sawiris as Telecom Italia SpA’s main shareholder should the Egyptian billionaire invest in the phone company, Economic Development Deputy Minister Antonio Catricala said.

Catricala spoke to reporters today in Rome. Sawiris told Bloomberg News on Jan. 26 he is ready to invest in Italy’s largest phone company on the condition that the carrier’s biggest shareholder, Telefonica SA (TEF), would exit, and Telecom Italia doesn’t sell its Brazilian business.

The government’s approval could make it easier for a foreign investor to help revive the country’s former phone monopoly. Sawiris is circling Telecom Italia again after his offer to buy a stake in the phone company for at least 2 billion euros ($2.7 billion) was rebuffed more than a year ago.

An investment by Sawiris would mark a comeback for a businessman who helped shape Italy’s phone industry. He ventured into the country in 2005, when he bought wireless carrier Wind in a 12.2 billion-euro deal from utility company Enel SpA. He sold Wind to VimpelCom Ltd. in 2011.

Sawiris said in the interview that Telecom Italia needs a capital increase of 3 billion euros to 4 billion euros. Telecom Italia Chief Executive Officer Marco Patuano said the next day there is no “hypothesis” for a capital increase.

Sawiris said Telecom Italia should hold onto its stake in Tim Participacoes SA (TIMP3), the Brazilian carrier whose market value has jumped almost 50 percent to about $13 billion in the past 12 months. Telefonica, which controls Telefonica Brasil SA (VIVT4), is keen to push Telecom Italia to sell Tim or break up the unit among the country’s carriers, people familiar with the matter have said.

Shares of Telecom Italia rose 1.6 percent to 82.8 cents at 12:13 p.m. in Milan. The stock has gained about 15 percent this year.

To contact the reporter on this story: Daniele Lepido in Milan at dlepido1@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net

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