Italtel Confirms IPO Plan
The move ends years of speculation and canceled plans, during which a number of potential takeover rumors came and went. The company's first IPO plan was shelved in 2000, when Telecom Italia (TIM) -- an Italtel customer and still the holder of a 19.4 percent stake in the firm -- sold its majority holding to a group of investors. (See Scuttlebutt: Italtel's Up for Grabs, Italtel Set for IPO, at Last, and Cisco et al Invest 1B Euro in Italtel.)
Now, though, the telecom market is healthier, VOIP is a mainstream service, and Italtel has registered significant success with telecom service providers, particularly in Europe. (See TP Picks Italtel, Cisco for VOIP, FastWeb Picks Italtel , Belgacom Picks Italtel, Cisco, and Marconi, Italtel Score at C&W.)
That success has propelled the Italian firm consistently into the top three ranked companies in the VOIP equipment market, according to market reports from a number of different research firms, and helped the company achieve a profit of €13.7 million (US$16.3 million) from revenues of €545.8 million ($651 million) in 2005. (See Dell'Oro: VOIP Gear Up and Italtel Gets the Softswitch Bronze.)
Now the company wants to reduce its debt, which stood at €322.2 million ($384 million) at the end of 2005, and expand into new markets. Italtel has hooked up with Accenture in a bid to break into the Latin American market but has, for the time being, shelved its plans to find a North American partner. (See Italtel, Accenture Team Up and Italtel: We Need US Partner.)
The company declined to say how much of its stock it plans to float, or how much money it hopes to raise, citing a pre-IPO quiet period. A report in the Italian media, citing unnamed sources, suggests Italtel plans to place between 40 and 45 percent of its capital on the Italian exchange and issue €200 million ($238 million) in new shares as well as selling some existing stock.
Telecom Italia is the second biggest stakeholder at present. The main owner is Clayton Dubilier & Rice Inc. , which holds 48.8 percent, while Cisco Systems Inc. (Nasdaq: CSCO), a close partner of Italtel's, owns 18.4 percent. Advent International owns 8.7 percent, Brera Capital Partners LLC holds 2.2 percent, and Italtel's staff owns 2.7 percent. (See Cisco, Italtel Get Closer.)
— Ray Le Maistre, International News Editor, Light Reading