Telecom Italia (TIM) has signed a preliminary agreement to acquire two separate BT business units in Italy serving the Public Administration (PA) and SME sectors for an undisclosed sum. BT Italia's PA Business Unit provides communication services to a number of ministries and agencies of the national government, as well as regional and local governments, while the SME Business Unit offers connectivity and cloud services to small and medium enterprises throughout Italy. The deal also includes customer support for the SME unit, delivered by BT's Palermo contact centre, said the companies, adding that the two units generated revenues of around EUR 90 million during the fiscal year ending in March 2020.

In a joint statement, TIM said the proposed acquisition of BT Italia’s PA Unit would allow it to expand its supply of communication and connectivity services and accelerate the digitalisation of the Italian Public Administration, with the planned integration of BT’s SME subsidiary enabling the operator to further diversify its offer of secure ICT and cloud services for local SMEs. BT said the planned transaction is part of the ongoing transformation of its Global unit, adding that it intends to retain a strong presence in Italy serving multinational businesses and organisations, including access points to its global network and data centres.

The transaction is subject to consultations with trade unions and regulatory clearance but the companies said they expect to complete the sale by the end of the first quarter of 2021.

BT has been attempting to sell its Italian assets since it suffered an accounting scandal in the country back in 2016 that forced the group to write down its value by GBP 530 million. According to 2019 data, BT Italia employed over 800 people and served around 80,000 corporate clients in the country including Eni, Fiat Chrysler Automobiles, Assicurazioni Generali, Armani and Mediaset.