Telecom Italia SpA has given Mexican financier David Martinez as many as 30 more days to complete the $960 million purchase of its stake in Telecom Argentina SA, allowing more time to obtain regulatory approval, according to two people familiar with the matter.
Telecom Italia’s directors this week extended the deadline from Sept. 1 for Martinez’s investment firm Fintech Group, and the status of the deal will be discussed at a board meeting scheduled for Sept. 25, said the people, who asked not to be identified because the decision had not been made public. There have been no other changes to the agreement terms, the people said. The deadline had already been extended from Aug. 12.
Telecom Italia Chief Executive Officer Marco Patuano, who has been in the job for almost a year, has sold assets and scrapped the dividend as he looks for new areas of growth to rejuvenate the indebted company. Telecom Italia’s debt rating was cut to junk by Standard & Poor’s and Moody’s Investors Service last year, and the company’s net debt of about 27.4 billion euros ($36 billion) at the end of June exceeds its market value.
Fintech Group agreed to pay $860 million for Telecom Italia SpA’s 68 percent holding in the company that controls Telecom Argentina, as well as a direct minority stake, plus $100 million for agreements including some technical services for the carrier, according to terms announced in November.