Telecom Italia today reached an agreement with News Corporation within the framework of the planned merger between Stream, a joint venture between Telecom Italia and the News Corporation that hold equal stakes, and Tele+, a television broadcaster belonging to the Vivendi Group.
Under the terms of the agreement, Telecom Italia undertakes, along with News Corporation, to cover pro quota the overall financial requirements of Stream until 31 December 2001 up to the amount of 399 billion lire (€ 206 million).
In the event that the planned merger between Stream and Tele+ receives the approval of the relevant authorities by 31 December 2001, or at a later date mutually agreed by the parties, Telecom Italia will have the right to exercise its right to sell its stake in Stream for 110% of the total amount effectively paid. This right may also be exercised upon the same conditions also in the event that the planned merger occurs after 31 December 2001 or at a later date not agreed upon by the parties, provided that Telecom Italia has actually paid out the whole amount it is engaged for.
Should the planned merger between Stream and Tele+ fail to obtain the approval of the relevant authorities, News Corporation will repay Telecom Italia 50% of the total funding provided up to a maximum amount of circa 200 billion lire.
The go-ahead from Telecom Italia will effectively enable Stream to finalise the agreements aimed at the planned merger with Tele+.