Swisscom AG is weighing an offer for Vodafone Group PLC’s Italian business early next year, potentially countering a rival bid from Iliad SA for the unit, Bloomberg reported, citing people familiar with the matter said.

The possible deal would combine Vodafone‘s mobile service with Swisscom’s Fastweb SpA fiber broadband carrier in the country, the people said.

https://www.bloomberg.com/news/articles/2023-12-20/swisscom-is-said-to-plan-vodafone-italy-bid-early-next-year?srnd=premium

Swisscom and Vodafone are in talks to discuss the terms and a formal bid could be announced as soon as next month, they said.

On Monday, Vodafone confirmed it was ‘exploring options with several parties’ to combine or sell its telecommunications operations in Italy.

The announcement by Vodafone followed a statement by French peer Iliad SA earlier Monday saying it has submitted a proposal to the UK company to create a new joint venture company that combines Vodafone Italia and Iliad Italia.

Iliad said its proposal gives Vodafone Italia an enterprise value of €10.45 billion and Iliad Italia a value of €4.45 billion. Each side would receive a 50% stake in the new company, with the valuations balanced by a €6.5 billion cash payment to Vodafone, compared to just €500 million for Iliad. Both Vodafone and Iliad also would receive €2.0 billion shareholder loans.

Iliad said the merger would create ‘the most innovative telecom challenger in Italy’, with annual revenue of about €5.8 billion.

It said the proposal has the unanimous support of Iliad’s board and of its main shareholder Xavier Niel.

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