Should US investor KKR be allowed to buy Telecom Italia?

The US investment fund KKR wants to take over the largest Italian telecommunications group TIM (Telecom Italia). Since the Italian state has a veto right through its "golden power" to block takeovers not deemed in the national interest, Rome would have to approve the sale first. The press debates what course the government should take.

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Avvenire (IT) /

The state must intervene

Avvenire hopes Rome will prevent the takeover with the so-called Golden Power Law:

“The question is whether and how the public good of universal, high-quality access to the telecommunications network can be reconciled with potential ownership by a private equity fund whose goal is the short-term maximisation of return on capital (and which consequently has no interest in investing in network quality in less profitable areas). It is no accident that in no advanced industrialised country is the telecommunications network in the hands of a private equity fund. ... Golden Power is the power of the government to intervene to protect strategic sectors when private companies threaten to take over.”

La Repubblica (IT) /

Infrastructure will remain protected

The takeover is fine as long as national security remains guaranteed, La Repubblica concludes:

“Insiders call it the backbone. Together with the primary and secondary national network, this is the 600,000 kilometers of fiber-optic cables (mostly underwater) operated by subsidiary Telecom Sparkle, whose encryption and security are monitored by [cybersecurity company] Telsy. The heart of our national security is at stake here. ... The government is prepared to protect our backbone. And it will do so by definitively separating the network and its infrastructures from the service part in the event of a takeover by KKR.”