What’s up with… Telecom Italia and KKR, Verizon, Huawei
By TelecomTV Staff
Aug 11, 2023
- Italy and KKR sign a preliminary deal on Telecom Italia’s NetCo
- Verizon cautions of unsolicited offer undermining its share value
- Huawei reports revenue increase in spite of trade ban
In today’s industry news roundup: The Italian government sings a provisional deal with KKR for a stake in Telecom Italia’s network business; Verizon warns its investors not to accept unsolicited “mini-tender” offer; Huawei books revenue increase for the first half of the year; and more!
The Italian government has reportedly agreed to allow US private equity firm KKR (Kohlberg Kravis Roberts) to take a stake in Telecom Italia’s network business NetCo. KKR signed a preliminary deal to include the government in its €23bn ($25.3bn) bid for the former phone monopoly’s network after prime minister Giorgia Meloni signalled that she considers Telecom Italia’s network a strategic asset requiring a degree of public oversight, according to Bloomberg. The government had put the network business up for sale earlier this year to reduce its debt pile and give it some financial elbow room to invest in infrastructure. According to the Ministry of Economy and Finance, the deal with KKR provides “a decisive role for the government in defining strategic choices.” Telecom Italia’s shares climbed 5.6% on the news.
Warnings of possible share dealing shenanigans have been issued by Verizon following the targeting of its shareholders with an unsolicited “mini-tender” offer this month. The offer, from TRC Capital Investment Corporation, undertakes to purchase up to 3 million shares of Verizon common stock at $31.95 per share, a price approximately 4.43% lower than the closing price on the NYSE on 1 August. Verizon points out that the US Securities and Exchange Commission (SEC) website warns that such mini-tender offers are often used to catch investors off guard – causing them to sell their shares at below-market prices. Verizon may also be worried about a sneak attack. It points out that by seeking less than 5% of its outstanding shares, the acquiring entity in this case would avoid “many disclosure and procedural requirements that the SEC requires for tender offers.”
Still on Verizon… the US telco has announced a strategic global partnership making HCLTech its primary managed network services (MNS) collaborator in all networking deployments for global enterprise customers. Verizon says the partnership combines Verizon’s networking power, solutioning and scale, with HCLTech’s market leading managed service capabilities to usher in a new era of large-scale wireline service delivery for enterprise customers. It says Verizon Business will continue to lead all customer acquisition, sales, solutioning, and overall planning and development with its customers, while HCLTech will lead post-sale implementation and ongoing support. A select group of Verizon operations staff will transition to HCLTech. The company claims Verizon Business’s global reach and localised enterprise presence together with HCLTech’s digitally optimised platforms for MNS will give its customers a flexible networking framework to build out with new technology and drive more efficient operations.
Chinese vendor Huawei has returned to growth in the first half of 2023, booking a 3% year-on-year rise in revenue to ¥310.9bn ($42.9bn). The majority of its revenue came from its ICT infrastructure business (bringing in ¥167.2bn, equal to $23bn), followed by its consumer business (revenue of ¥103.5bn, or $14.3bn), ‘digital power business’ (¥24.2bn, or around $3.4bn), cloud business (revenue of ¥24.1bn, around $3.3bn) and its intelligent automotive solution (IAS) contributing ¥1bn ($138m) in revenue. The company did not disclose figures for its profit in the period. “Huawei has been investing heavily in foundational technologies to harness trends in digitalisation, intelligence, and decarbonisation, focusing on creating value for our customers and partners. In the first half of 2023, our ICT infrastructure business remained solid and our consumer business achieved growth. Our digital power and cloud businesses both experienced strong growth, and our new components for intelligent connected vehicles continue to gain competitiveness”, commented Sabrina Meng, Huawei’s rotating chair. The vendor has been continuously struggling due to US sanctions, with a culmination hit in 2022 when it reported its lowest operating and net profits in almost a decade – see Huawei’s profits slump as it ups its R&D spending.
Video chat and a whole lot more is coming to X (formerly Twitter). At least according to X CEO Linda Yaccarino who gave an interview on CNBC during which she said users would be able to make video chat calls without having to “give their phone numbers to anyone on the platform.” The terrifying prospect is all part of the plan by X owner, Elon Musk, to develop his global town square, “fueled by free expression,” says Yaccarino. It will be a place where commerce rules, the global public gathers and everything will be available – including long-form videos, payments and creator subscriptions. It’s all a “liberation from Twitter,” she said, “a liberation that allows us to evolve past a legacy mindset.” The mind boggles.
- The staff, TelecomTV