De Benedetti warns of hostile bid for Olivetti

Carlo de Benedetti, former chairman and CEO of Olivetti, has warned that the vendor could be the target of a hostile takeover bid following a #830 million deal with German firm Mannesmann.

The German engineering group recently acquired a 49.9 per cent share in the struggling Italian group?s telecoms companies, Omnitel Pronto Italia and Infostrada.

The move comes after Olivetti?s computer and services subsidiary, Olsy, was linked with a possible sale to Wang Laboratories (PC Dealer, 3 September). De Benedetti confirmed the company was involved in talks with Wang Laboratories regarding the sale.

He claimed that Olivetti was in a vulnerable state and could either become a public company controlled by a group of shareholders or may be taken over by a telecoms group.

Olivetti is trying to raise #360 million through a rights issue, a quarter of which Mannesmann will underwrite. Part of the funds raised through the rights issue and the alliance with Mannesmann will be used to repay Olivetti?s debts.

But Olivetti is expected to pump further investment into the expansion of the Infostrada fixed-line telephone system ? in which it has a 66.7 per cent stake ? and Omnitel, in which it owns 50.7 per cent. Olivetti will retain management control of both businesses.

Meanwhile, Robert Schisano has been named as group CEO of Piedmont International, which took over Olivetti Personal Computers earlier this year. Bernhard Auer will continue as chairman and CEO of Olivetti Computers worldwide. Edward Gottesman has been appointed chairman of Piedmont International.