Telefonica pays EUR 4.1 billion for 18% of Telecom Italia

Rating: the only way is up

Telefonica, Europe’s second-largest phone company, and its Italian partners — Assicurazioni Generali SpA, Intesa Sanpaolo SpA, Mediobanca SpA and the Benetton family — will buy Olimpia, the investment engine that controls the board of mobile company Telecom Italia, from Pirelli & C. SpA, Intesa Sanpaolo.

This is great news for Telefonica. I remember when its pan-European strategy was in tatters and it pulled out of Quam and de-invested the majority of its new 3G license interests. Italy remains the hottest market in Europe and Telefonica is becoming a greater threat.

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