TIM clears first hurdle in obtaining state guarantees for $3.1 billion loan

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The Tim logo is seen at its headquarters in Rome, Italy, November 22, 2021. REUTERS/Yara Nardi

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ROME, May 16 (Reuters) – Italy’s biggest telephony group Telecom Italia (TIM) has been given the green light by credit export agency SACE over state guarantees backing a bank credit line of worth up to 3 billion euros ($3.1 billion), two sources close to the case said on Monday.

SACE’s board authorized the state guarantees on May 10, without making its decision public, the sources said.

It is now up to the Italian Ministry of Economy to follow up on the preliminary green light from SACE, by signing a decree authorizing the commitment.

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The state-guaranteed loan would bolster TIM’s finances as new CEO Pietro Labriola works on a turnaround plan for the former phone monopoly, which posted a record net loss of 8.4 billion euros in 2021 .

A group of banks including Italy’s UniCredit (CRDI.MI), France’s BNP Paribas (BNPP.PA) and Credit Agricole (CAGR.PA) as well as Spain’s Santander (SAN.MC) had pre-approved the financing of TIM subject to the Italian state providing guarantees, Reuters reported last week.

One of the sources said the Economy Ministry did not see any major obstacles to providing the guarantees, but that a decision would only be made after the end of a review process.

($1 = 0.9590 euros)

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Reporting by Giuseppe Fonte and Valentina Za; Editing by Emelia Sithole-Matarise

Our standards: The Thomson Reuters Trust Principles.

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