Former Silvio Berlusconi Ally Last Bidder for Italy's La7 Broadcaster
A last-minute offer from leather goods tycoon Della Valle was rejected, giving Cairo Communications two weeks to close the deal for the country's smallest national broadcaster.
ROME – Telecom Italia Media said Tuesday it would enter into exclusive negotiations for control of broadcaster La7 with Cairo Communications in a deal that could increase Silvio Berlusconi’s already considerable influence on Italian television.
Cairo Communications, the ad buyer for former state telephone monopoly Telecom Italia and Telecom Italia Media, is controlled by businessman Urbano Cairo. He is a former Berlusconi lieutenant who set out on his own in 1995; some media outlets report that the two men reportedly remain close.
Berlusconi is already the most powerful figure in Italian television: his company Mediaset already controls three of seven national television networks.
Berlusconi, a billionaire media mogul known for personal and legal scandals, is running to become Italy’s prime minister for a fourth time in a Feb. 24-25 vote. He is thought to be trailing former minister Pier Luigi Bersani among likely voters, but if Berlusconi wins, he’ll have some control over the three networks from state broadcaster RAI. And if Cairo gains control of La7, he’ll likely have at least some connection to the seventh and smallest of the national free-to-air television networks.
It is not guaranteed Cairo will win control of La7 -- he will have two weeks to hammer out a deal with officials from Telecom Italia Media.
But the deal is already causing some controversy in the Italian media, which worries that La7’s editorial autonomy would be at risk if Cairo gains control of the company. The network’s main drawing card up until now is that it has been independent of the political forces that often characterize news coverage from Mediaset and RAI.
Cairo sought to put those fears to rest: “I was fired by Berlusconi in 1995 and he has been my adversary since then," said Cairo, who has also promised not to remove or replace any of La7’s current news team.
By entering into exclusive talks with Cairo Communications, it means Telecom Italia Media rejected offers from private equity fund Clessidra, as well as a last-minute overture from leather goods and fashion magnate Diego Della Valle. But those offers could be opened again if Cairo Communications is unable to close the deal.
Details about Cairo Communications' bid are not known. But it is known that the company bid only for La7, leaving Telecom Italia Media's controlling stake in MTV-Italia and its broadcast infrastructure to be shopped around separately.
Telecom Italia is looking to unload its non-core holdings in order to focus on its telephone business and pay down debt.
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