Regulator looks into Telecom Italia bond, Argentina stake sale

Wed Nov 13, 2013 1:58pm EST
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MILAN/ROME (Reuters) - Telecom Italia (TLIT.MI: Quote) said officials from market regulator Consob, along with Italy's financial police, were at its offices on Wednesday to gather details of its recent convertible bond issue and the sale of a stake in Telecom Argentina (TEC2.BA: Quote).

The 1.3 billion euro bond and the sale of its Argentinean asset are part Telecom Italia's new business plan, and have been criticized by some minority investors who have accused the board of only looking after the interests of main shareholders.

The inspection also related to company procedures on keeping privileged information confidential, the Italian phone group said in a statement.

Telecom Italia said it had always respected Italy's financial market rules, and guaranteed total cooperation with authorities.

A source close to Consob said the visits on Wednesday were made to Telecom Italia's headquarters in Milan and Rome.

Telecom Italia's strategy review, approved at a board meeting on November 7, comes after a deal in September that gives Spain's Telefonica (TEF.MC: Quote) an option gradually to take over its rival by buying out its three Italian partners in Telco.

Telco, whose Italian investors are Generali (GASI.MI: Quote), Mediobanca (MDBI.MI: Quote) and Intesa Sanpaolo (ISP.MI: Quote), is a holding company that controls Telecom Italia with a 22.4 percent stake. Telco appoints the majority of Telecom Italia's board.

In a separate development, judicial sources told Reuters that a few weeks ago Rome prosecutors opened an investigation into the sale of Telco shares to Telefonica.

They said prosecutors were also focusing on information stemming from Consob's checks and that there were no allegations of wrongdoing at the moment.   Continued...

A Telecom Italia phone booth is pictured in front of St Peter's Basilica in Rome September 24, 2013. REUTERS/Alessandro Bianchi