Business Health Miscellaneous Mobile Phones Networks News

Three Italia to be bought out by Telecom Italia

This isn’t exactly surprising news for anyone following the telecoms situation in Italy, but Three hasn’t have a great deal of success since entering the Italian market, prompting speculation that they could soon be bought out. That speculation has only increased recently, since Telecom Italia confirmed that contact had been made between the two companies, when a spokesman said “The contacts are in such immature and preliminary status that the company cannot further comment on the news”.

The failure of Three (Hutchinson) to really penetrate the Italian market can be summed up by looking into the numbers. With a rather impressive 6.7 million subscribers to the service, it looks enough to sustain a business, but when you take into account the 32.1 million subscribers of Telecom Italia and the 26.3 million and 21.6 million of Vodafone and Wind respectively, you start to see the uphill struggle they face.

Couple their subscribers issues with the uncertain future of economies in the area and you start to see a picture of a company that would welcome a potentially exit strategy in the form of a buyout. The word “merger” is being branded around, but I’d imagine that the head offices of Hutchinson would prefer to close the book on their involvement in the Italian market, handing subscribers and employees to Telecom Italia instead.

Just how the deal will be ironed out is yet to be confirmed, but with talks scheduled for April 11th 2013, we’ll likely know sooner rather than later.