O’Brien’s Digicel reportedly bidding for Italian assets

Denis O'Brien's Digicel Group is reportedly among bidders vying to to take over Italian assets being sold off as part of a planned merger between two companies in the market.

Digicel, operating across 31 markets in the Caribbean and South Pacific regions, submitted a preliminary offer for assets being sold by Dutch telecoms company VimpelCom and Hong Kong-based CK Hutchison Holdings as they seek regulatory approval to merger their Italian wireless carriers, according to Bloomberg. Swisscom and French phone group Illiad have also made offers, it said.

A move by the Digicel to acquire the assets, which include wireless frequencies and about 5,000 towers, would make a departure from its focus since its 2001 foundation in Jamaica on emerging markets. O'Brien has been waiving a $10 million-a-quarter cash dividend since late last year from Digicel, after he pulled a planned $2 billion share sale and flotation of the company to help cut its debt.

Digicel's consolidated debt amounted to $6.4 billion (€5.6 billion) at the end of December, up from $4.9 billion at the end of the company's financial year in 2012, Fitch, the ratings agency, said in a report last month.

By lining up buyers, Hutchison’s 3 Italia and VimpelCom’s Wind Telecomunicazioni are trying to avoid a repeat of last month, when the EU blocked a UK deal also involving Hutchison, according to Bloomberg.

Vestager is said to be preparing formal objections to the €21.8 billion Italian deal, which would create the country’s largest wireless provider by customers. The commission will provide feedback to Hutchison and VimpelCom on the bids in a few days, though it won’t choose a bidder.

Representatives for VimpelCom, Hutchison and Digicel declined to comment, while an Iliad spokesman had no immediate comment.