Telecom Italia takes steps to reduce debt

Telecom Italia's new business plan aims to reduce crushing debt and grow revenue.

Photo: Telecom Italia takes steps to reduce debt

The plan being unveiled Friday is the first by the new management put in place after Spain's Telefonica and a group of Italian banks took over Italy's largest telecommunications company last year. It calls for revenue growth of 1 percent to 2 percent a year through 2010.

Telecom Italia has already announced a plan to lower the dividend by nearly half, to Ђ 0.08 (US$0.12) a share, as part of its efforts to reduce debt. It has reported 2007 profits down 19 percent after the government forced it to stop charging a fee to recharge mobile telephone cards and reductions in termination fees.

Telecom Italia is an Italian Telco. It was founded in 1994, by the merger of several state-owned telecommunications companies, the most important of which was SIP, the then monopolist telephone operator. Originally state-owned, it is now mainly privately-owned. It has the largest user base in Italy.

Telecom Italia operates landline telephone services in Italy, GSM phone services (as TIM, present in Italy and Brazil) and ADSL services with the brand Alice in Italy, Germany (Hansenet, bought by Telecom Italia in 2003, acquired the internet access branch of AOL Germany in 2006/2007), France (after the acquisition of Liberty Surf in 2005) and the Netherlands (through the controlled company BB Ned).

Telecom Italia also owns shares in Telecom Argentina and Telecom Personal, fixed and cellular networks in Argentina.