...April 18, 2024 - Kohlberg Kravis Roberts & Co. L.P. (KKR) has signed a binding offer to purchase Telecom Italia SpA's (TIM's) Italy-based fixed-line wholesale operator Optics Bidco SpA (Optics) for an enterprise value of 18.8 billion. KKR will finance the deal through the issuance of about 4 billion in senior secured term loans, about 4.5 billion debt from TIM, and an equity injection of 10.5 billion. - After the separation, Optics will be the leading fixed-line wholesale operator in Italy, benefiting from its significant market share in the broadband and ultra-broadband fixed market with limited network overlap, high capital barriers, and favorable growth opportunities. - However, we expect the company's large fiber-to-the-home (FTTH) capital expenditure (capex) program will result in negative free cash flow generation. This, combined with expected dividend payments, will increase forecast leverage over the next two years. - We assigned our preliminary '##+' long-term issuer credit and...
