The Italian court will soon rule on Vivendi’s appeal against the sale of TIM’s network by Reuters

MILAN (Reuters) – An Italian court is expected to decide this week on a request from Telecom Italy (BIT:) (TIM) the first investor Vivendi (OTC:) to reverse the former telephone monopoly’s decision to sell its landline network to a consortium led by KKR, a source close to the matter said.

Vivendi, which owns 24% of TIM, filed a complaint with a Milan court in December 2023 to challenge the sale, worth up to 22 billion euros ($22.4 billion).

Under Italian rules, a non-binding deadline for the court to decide on the case expired earlier this week.

Sponsored by Italy’s conservative government, which bought 16% of the network as part of the deal, the KKR sale helped cut debt and stabilize TIM’s finances.

Vivendi criticized the deal, seeking a higher price, and questioned the sustainability of the business left.

Vivendi says that the decision should go through an extraordinary vote of the shareholders, and not just the board.

The sale has changed the nature of TIM’s business and dissident shareholders should have the right to withdraw by selling their shares to the company, Vivendi said.

TIM said his counsel acted within his rights. The deal closed in July.

After a round of fruitless talks with Rome on the future of TIM, the Paris-listed group took a back seat as an investor and in January 2023 withdrew its representative on the board of TIM.

Vivendi no longer considers the TIM holding as strategic and is open to a potential sale of its stake, which is currently worth 930 million euros.

The filing has drawn interest from private equity firms, including CVC, according to people familiar with the matter. Vivendi is looking for a price between 1.0-1.5 billion euros, according to two of the sources. Vivendi declined to comment.

However, any transaction requires support from the Italian government, which has the power to greenlight any sale of more than 3% of TIM.