by Paolo Laudani
(Reuters) – Swisscom said on Wednesday it was in advanced negotiations with Vodafone for the acquisition of its entire Italian branch, confirming information from Reuters on the potential merger of the Italian activities of the two companies.
Swisscom and Vodafone have agreed on a preliminary purchase price of 8 billion euros excluding debt, the Swiss telecommunications operator said in a statement.
Swisscom plans to merge Vodafone Italia with its local subsidiary Fastweb.
In pre-market trading, Swisscom shares rose almost 2% at 07:06 GMT.
Vodafone is expected to hold a minority stake in the combined entity with Swisscom’s Italian unit, three people familiar with the matter told Reuters.
A deal with Fastweb would create the second-largest fixed-line broadband operator in Italy and would face lower regulatory hurdles than a Fastweb tie-up with Iliad even if it offers fewer potential synergies, according to analysts.
(Editor Paolo Laudani, Corentin Chappron, edited by Kate Entringer)
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