Telecom Italia S.p.A.: ATTACHMENTS TO THE PRESS RELEASE
09 Mai 2012 - 8:55PM
Italian Regulatory (Text)
e issuing company or the guarantor, the incorporating or
transferee company shall assume all of the obligations of the
merged or transferor company. Non-fulfillment of the obligation,
for which a solution is not found, is an event of default;
Contracts with the European Investment Bank (EIB.) The total
nominal amount is 2.95 billion euros. The contracts signed by
Telecom Italia with the EIB, for the amount of 2.65 billion euros,
carry the obligation of promptly informing the Bank about changes
regarding the Bylaws or the allocation of capital among the
shareholders which can bring about a change in control. Failure to
communicate this information to the bank shall result in the
termination of the contract. Furthermore, when a shareholder, who
at the date of signing the contract does not hold at least 2% of
the share capital, comes to hold more than 50% of the voting rights
in ordinary shareholders' meetings or, in any case, a number of
shares such that it represents more than 50% of the share capital
and, in the bank's reasonable opinion, this fact could cause a
detriment to the Bank or could compromise the execution of the loan
project, the Bank has the right to ask Telecom
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Italia to provide guarantees or modify the contract or find an
alternative solution. Should Telecom Italia not comply with the
requests of EIB, the bank has the right to terminate the contract.
Specifically: in the loan signed by Telecom Italia with the EIB on
August 5, 2011 and in the three contracts assisted, respectively,
by bank guarantee and by a guarantee issued by Sace S.p.A. signed
on September 26, 2011, for a total amount of 200 million euros,
there is change in control if a subject or a group of subjects
acquire the control of Telecom Italia, or of the entity controlling
it directly or indirectly. There isn't change in control in case
the control is acquired directly or indirectly by (i) any
shareholder of Telecom Italia that at the date of the contract
holds directly or indirectly at least 13% of the voting rights in
the ordinary board or (ii) by the investors Telefónica S.A.,
Assicurazioni Generali S.p.A., Intesa Sanpaolo S.p.A. and
Mediobanca S.p.A. or by their subsidiaries; furthermore, the three
contracts guaranteed and dated September 26, 2011 provide the
"clause for inclusion" according to which in case Telecom Italia
commits herself to maintain in other loans financial covenants not
present or more restrictive than those granted to the EIB, the bank
will have the right to demand the constitution of guarantees or the
amendment of the loan contract in order to have an equivalent
clause in favour of the EIB. That expectation is not applied to the
subsidized loans until the total amount of the outstanding capital
financed does not exceed the amount of 500 million euros; Export
Credit Agreement (nominal outstanding amount 37,573,952 euros). The
contract was signed in 2004 by Telecom Italia and Société Générale
and provides the repayment of the loan in 2013. It is established
that, in the event of a change in control and subsequent failure to
reach an agreement with the lender bank, Telecom Italia shall repay
the outstanding loan at the first date in which the interest
payment shall be due; Senior Secured Syndicated Facility (nominal
outstanding amount 312,464,000 Argentinean pesos, equal to
approximately 53 million euros). The contract was signed in October
2011 between BBVA Banco Francés and Tierra Argentea S.A. (company
fully-controlled by the Telecom Italia Group) and provides the
repayment of the loan in 2016. The loan is granted by two pledges
set up on (i) 15,374,858 Telecom Argentina's shares and (ii)
2,351,752 American depositary Shares (ADS) representing of 117,588
preferred B shares of Nortel Inversora S.A.. The covenants
contractually provided, as negative covenants or financial
covenants, are coherent with those of the syndicated credit
facilities and with the local market practice; furthermore, there
is a clause of change in control that comply the total repayment in
advance of the loan in case the Telecom Group holds less then the
100% of Tierra Argentea S.A. or loses the control of the other
Argentinean subsidiaries. Finally, in the documentation of the
loans granted to certain companies of the Tim Brasil group, the
companies must generally respect certain financial ratios (e.g.
capitalization ratios, ratios for servicing debt and debt ratios),
as well as customary negative pledges clauses, worth the request
for the repayment in advance of the loan. Finally, as of March 31,
2012, no covenants, negative pledge clauses or other clauses
regarding the above described debt position have been breached or
violated in any way.
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TELECOM ITALIA GROUPEFFECTS OF NON-RECURRING EVENTS AND
TRANSACTIONS ON EACH
ITEM OF THE SEPARATE CONSOLIDATED INCOME STATEMENTS
The effect of non-recurring events and transactions on the separate
consolidated income statements is set out below in accordance with
Consob communication DME/RM/9081707 dated September 16, 2009:
1st Quarter 2012
(millions of euros)
1st Quarter 2011
Impact on EBITDA - Operating profit before depreciation and
amortization, Capital gains (losses) and Impairment reversals
(losses) on non-current assets Impact on EBIT - Operating profit
Share of profits (losses) of associetes and joint ventures
accounted for using the equity method Other income (expenses)
from investments Net gain on disposal of EtecSa (Cuba) Impact on
profit (loss) before tax from continuing operations Effects of
income taxes Impact on profit (loss) for the period
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