TIM shares lose 7.7% on Milan bourse after positive start

(ANSA) - ROME, MAR 11 - Shares in Italian telecoms giant TIM took a tumble in mid-morning trading on Monday after getting off to a positive start following an extraordinary board meeting on Sunday and the subsequent confirmation of 2024-2026 guidance and integration of last Thursday's market communication with data on expected cash flow.
    The share price fell by 7.7% to 0.20 euro, taking it to December 2022 levels.
    Earlier it had risen by 2.2% to 0.227 euro after TIM said it expected "its pro-forma net debt, after the Netco transaction, to be around 7.5 billion euro at the end of 2024" and "net cash flow to be around zero in 2025 and around 500 million euro in 2026, normalised to 800 million".
    The company also said "any upside to the guidance could derive from earn-outs connected to the Netco transaction and the possible sale of Sparkle, the process for which is still ongoing".
    TIM called an extraordinary board meeting on Friday after shares in the company plummeted 24% on the Milan stock market following the unanimous approval of its 'Free to Run' 2024-2026 business plan on Wednesday.
    However, on Sunday CEO Pietro Labriola and advisors told the board that the plan could not be considered responsible for the crash and could go ahead.
    TIM has received backing from the government for the sale of its landline grid NetCo to American fund KKR as part of efforts down its debts, which currently add up to around 26 billion euros.
    Under the deal that could reach 22 billion euros, the Italian State is to take a stake of up to 20% in the grid, which is considered strategic infrastructure.
    Italy's largest trades union confederation CGIL has described the plans as "madness".
    "We have said from the outset that the separation and sale of the network is an error," said Secretary Maurizio Landini on the sidelines of a peace march in Rome.
    "Splitting up the company is madness. It is exactly the opposite of what is needed," he continued, adding that the move risks jeopardising a company "that is fundamental for our country".
    (ANSA).