1. Telefonica, Europe's second-largest phone company, and its Italian partners -Assicurazioni Generali SpA, Intesa Sanpaolo SpA, Mediobanca SpA and the Benetton family - will buy Olimpia, the investment vehicle that controls the board of Telecom Italia, from Pirelli & C. SpA.
2. They agreed to pay 4.1 billion euros ($5.6 billion) for a controlling 18 percent stake at 2.82 euros per underlying share of Telecom Italia, 24 percent above the 2.27 euro closing price on April 27.
3. Through Telecom Italia, Telefonica will bolster its position in the Brazilian wireless market, which has expanded 6.6 percent since September. (Vivo, a wireless operator jointly controlled by Telefonica and Portugal Telecom SGPS SA remains the biggest mobile-phone operator in Brazil)
4. The two telephone operators (Telecom Italia & Telefonica) will be run independently and expect cost savings after the transaction
Synergy and cost savings from independent operations? Bargaining power from Brazil?
[Click here for full story at: BLOOMBERG.COM]
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