The two largest shareholders of INWIT, Italy's biggest mobile telecom-towers operator, are in early talks with banks about financing a possible take-private deal. The move comes even as a contract dispute with the company's largest customers continues to weigh on its outlook.
According to Reuters, citing people familiar with the matter, Ardian, which holds about 32% of INWIT, and Oak Holdings 1, which owns roughly 39%, are exploring a bid to buy out minority shareholders. Oak is backed by a group of co-investors including Global Infrastructure Partners (a part of BlackRock), Vodafone, and KKR. One source said Mubadala, an Abu Dhabi state investor, may also join the effort.
The timing is awkward. INWIT's market value has fallen about 27% over the past year to roughly €6.3 billion, reflecting investor concerns about the company's growth prospects and the ongoing dispute with its biggest customers, TIM and Fastweb.
What is a take-private and why does it matter?
A take-private is a deal in which a company's majority owners buy out the remaining public shareholders, removing the company from the stock exchange. For the controlling investors, it can offer more flexibility to make long-term decisions without the pressure of quarterly earnings expectations. For minority shareholders, it usually means receiving a cash offer for their shares, often at a premium to the current market price.
In this case, Ardian and Oak already control more than 70% of INWIT combined. If they proceed, they would need to acquire the remaining roughly 30% of shares held by public investors. Financing such a deal would likely involve bank loans, which is why the two shareholders are in talks with lenders.
The move echoes a broader trend in European infrastructure and telecom assets, where large investors have increasingly sought to take companies private to restructure or shield them from market volatility. Other take-private offers have also been in the news recently, as investors look for ways to gain full control of businesses they see as undervalued.
The dispute with TIM and Fastweb
INWIT operates a network of mobile phone towers across Italy, leasing space to telecom operators. Its two biggest customers, TIM and Fastweb, are currently in a contractual dispute with the company. The details of the dispute are not fully public, but it appears to involve the terms of the lease agreements and possibly the fees INWIT charges for using its towers.
Such disputes are not uncommon in the tower industry, where long-term contracts are the backbone of revenue. But they can create uncertainty about future cash flows, which is likely a key reason INWIT's share price has fallen over the past year. Investors worry that if the dispute is resolved unfavorably, INWIT could see lower revenue or be forced to renegotiate contracts on less attractive terms.
The dispute also comes at a time when telecom operators across Europe are under pressure to cut costs and invest in new 5G networks. That dynamic can make tower operators like INWIT more vulnerable to customer demands for lower fees.
What it means for investors
For everyday investors who hold INWIT shares, the key question is what a take-private offer would look like. If Ardian and Oak proceed, they would likely need to offer a price that attracts minority shareholders. Given that the stock has fallen 27% over the past year, any offer could come at a premium to the current market price, but it may still be below the levels seen a year ago.
For investors in other tower companies or telecom infrastructure, this deal is a reminder that such assets can be attractive to large private investors, especially when public market valuations are depressed. Vodafone and KKR have already been linked to this move, which underscores the interest from major infrastructure players.
It's also worth noting that the financing talks are still at an early stage. There is no guarantee that a deal will happen. The shareholders may decide that the dispute with TIM and Fastweb makes a take-private too risky, or they may not be able to agree on terms with lenders.
For now, investors should watch for any official announcement from INWIT or its major shareholders. The company is likely to face continued pressure until the contract dispute is resolved, and the outcome of that dispute will be crucial for the company's future, whether it remains public or goes private.
In the broader context, this story fits into a pattern of tower contracts facing pressure across Europe, as telecom operators seek to cut costs. It also highlights the growing role of infrastructure funds and sovereign investors in European telecom assets.
As always, investors should consider the risks and do their own research before making any decisions. A take-private offer, if it comes, would be a significant event for INWIT shareholders, but it is far from certain at this stage.
