O’Brien’s Digicel reportedly bidding for Italian assets

Bid would mark departure from Digicel’s focus on emerging markets

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. (Photograph: Swoan Parker/Reuters)

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. (Photograph: Swoan Parker/Reuters)

 

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.