* Telecom Italia board to meet on Thursday to decide
* Bids from Clessidra, Cairo remain unchanged - sources
* A deal might not carry a premium - analyst
* Sale complicated by media industry difficulties
By Danilo Masoni
MILAN, Jan 16 Debt-laden Telecom Italia
has failed to attract improved bids for its majority
stake in unprofitable Telecom Italia Media TV unit,
sources close to the matter said on Wednesday, raising the
prospect of a sale not going ahead.
The board of Telecom Italia meets on Thursday to decide
whether to go ahead with the disposal, which its management
initially aimed to complete by the end of 2012 to help cut its
debt of 29.5 billion euros ($39 billion) and focus on its core
However, the sale has dragged on because of difficult
industry conditions, with Telecom Italia seeking in vain to get
better offers from two bidders, private equity fund Clessidra
and media firm Cairo.
Sources close to the situation told Reuters neither
Clessidra nor Cairo had improved the binding offers first
presented last month, which Telecom Italia had considered too
"There has been no change," one of the sources said of
"Cairo is still interested and its offer remains unchanged,"
another source said.
Sources have said Clessidra values Telecom Italia Media at
330-380 million euros, including debt of 220 million euros. That
means that Telecom Italia, which has its 77 percent stake in the
company valued at 176 million euros in its books, would make no
capital gain if it sold at that price.
While Clessidra has bid for all of Telecom Italia Media -
two cash-burning TV channels and a profitable broadcast network
operator which leases bandwidth to carry its own and rival
channels - Cairo wants to buy only the TV business.
Sharp cuts in advertising spending and a proliferation in
new thematic channels have weighed on traditional TV
broadcasters like Silvio Berlusconi's Mediaset and
Telecom Italia Media's La7 has gained audience share thanks
to popular talk shows but there are doubts over how long it can
sustain the pace amid an economic recession and cut-throat
On Wednesday shares in Telecom Italia Media fell 1.6 percent
to 0.157 euros, almost unchanged from a year ago.
Kepler analyst Daniele Ridolfi said a sale may yield no
premium to current market prices, reiterating his "reduce"
rating and a 0.08 euros a share target price.
A second analyst, who declined to be named, was sceptical
the sale would be made. "I think they won't sell and Telecom
Italia will have to pay for the restructuring," the analyst
(Additional reporting by Claudia Cristoferi, Stephen Jewkes and
Stefano Rebaudo; Editing by Greg Mahlich)