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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(Rule 13d-101)
(Amendment No. 14)
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TELECOM ITALIA S.P.A.
(Name of Issuer)
ORDINARY SHARES OF EURO 0.55 PAR VALUE EACH 87927W10
(Title of class of securities) (CUSIP number)
ALEXANDER ROSENZWEIG, ESQ.
VICE PRESIDENT AND CHIEF LEGAL OFFICER
PIRELLI NORTH AMERICA, INC.
246 STONERIDGE DRIVE
SUITE 400
COLUMBIA, SOUTH CAROLINA 29210
(803) 951-1040
WITH A COPY TO:
ELLEN J. ODONER, ESQ.
WEIL, GOTSHAL & MANGES LLP
767 FIFTH AVENUE
NEW YORK, NEW YORK 10153
(212) 310-8000
(Name, address and telephone number of person authorized
to receive notices and communications)
DECEMBER 19, 2002
(Date of event which requires filing of this statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following
box. [ ]
Note: Schedules filed in paper format shall include a signed original
and five copies of the schedule, including all exhibits. See Rule
13d-7 for other parties to whom copies are to be sent.
(Continued on following pages)
(Page 1 of 10 Pages)
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CUSIP No. 87927W10 13D Page 2 of 10
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1 NAME OF REPORTING PERSON PIRELLI S.p.A.
I.R.S. IDENTIFICATION NO. OF
ABOVE PERSON Not Applicable
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS: BK, WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e): [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION: Italy
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7 SOLE VOTING POWER: 0
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH
----------------------------
---------------------- ------------------------------------------------- ----------------------
8 SHARED VOTING POWER: 2,891,656,682
(See Item 5)
----------------------------
---------------------- ------------------------------------------------- ----------------------
9 SOLE DISPOSITIVE POWER: 0
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---------------------- ------------------------------------------------- ----------------------
10 SHARED DISPOSITIVE POWER: 2,891,656,682
(See Item 5)
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON: 2,891,656,682
(See Item 5)
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----------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 54.96%
(See Item 5)
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14 TYPE OF REPORTING PERSON: CO
2
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CUSIP No. 87927W10 13D Page 3 of 10
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1 NAME OF REPORTING PERSON OLIMPIA S.p.A.
I.R.S. IDENTIFICATION NO. OF
ABOVE PERSON Not Applicable
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS: WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e):
---------------------------- ---------------------------------------------------------------------------- ----------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION: Italy
---------------------------- ---------------------------------------------------------------------------- ----------------------
7 SOLE VOTING POWER: 0
NUMBER OF
SHARES
BENEFICIALLY
OWNED BY
EACH
REPORTING
PERSON WITH
----------------------------
---------------------- ------------------------------------------------- ----------------------
8 SHARED VOTING POWER: See Item 5
----------------------------
---------------------- ------------------------------------------------- ----------------------
9 SOLE DISPOSITIVE POWER: 0
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---------------------- ------------------------------------------------- ----------------------
10 SHARED DISPOSITIVE POWER: See Item 5
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON: See Item 5
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----------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES: [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): See Item 5
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14 TYPE OF REPORTING PERSON: CO
3
This Amendment No. 14 amends the Statement on Schedule 13D dated
August 9, 2001, as amended (as previously amended, the "Statement on Schedule
13D"), filed by Pirelli S.p.A., a company incorporated under the laws of the
Republic of Italy ("Pirelli"), and, commencing with Amendment No. 1 thereto,
Olimpia S.p.A., a company incorporated under the laws of the Republic of Italy
(the "Purchaser" or "Olimpia"), with respect to the ordinary shares, euro 0.55
par value per share, of Telecom Italia S.p.A., a company incorporated under the
laws of the Republic of Italy. Capitalized terms used in this Amendment without
definition have the meanings ascribed to them in the Statement on Schedule 13D.
Pirelli, the Purchaser, Edizione Holding, UCI, BCI and, as discussed
in Items 4 and 6 below, Hopa S.p.A. ("Hopa") are members of a group with respect
to the Telecom Italia Shares. This Amendment constitutes a separate filing on
Schedule 13D by Pirelli and the Purchaser in accordance with Rule 13d-1(k)(2)
under the Securities Exchange Act of 1934. Pirelli and the Purchaser are
responsible solely for the information contained in their separate filing,
except that information contained in the Statement on Schedule 13D concerning
any director or officer of the Purchaser nominated by Edizione Holding, UCI, BCI
or Hopa has been provided by the nominating person.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
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On December 19, 2002, Olimpia made a proposal to the holders of its
1.5% 2001-2007 bonds (the "Olimpia Bonds") to retire the Olimpia Bonds in
exchange for either Olivetti Shares (as provided under the existing terms of the
Olimpia Bonds) or, alternatively, a combination of Olivetti Shares and Olivetti
2001-2010 1.5% bonds convertible into Olivetti Shares ("Olivetti Convertible
Bonds"). The Olimpia Bonds were issued in October 2001 and are described in
Amendment No. 4 to the Statement on Schedule 13D. On December 19, 2002, Hopa and
two companies that Hopa has advised are controlled by it, Holinvest S.p.A.
("Holinvest") and G.P.P. International S.A., accepted Olimpia's proposal for
retirement of the total of 262,533,449 Olimpia Bonds held by them by delivery of
a total of (i) 98,975,110 Olivetti Shares (representing approximately 1.12% of
the 8,845,313,805 Olivetti Shares reported to be outstanding on December 30,
2002) effective in January 2003 and (ii) 163,558,339 Olivetti Bonds effective in
June 2003.
ITEM 4. PURPOSE OF TRANSACTION
----------------------
On December 19, 2002, Pirelli, Edizione Holding, UCI and BCI
(collectively, the "Present Olimpia Shareholders"), Olimpia and Hopa
(collectively with the Present Shareholders and Olimpia, the "Parties") executed
a term sheet (the "Hopa Term Sheet"), a copy of which is filed as Exhibit 37.
Hopa is one of the Majority Bell Shareholders with whom, on September 19, 2001,
Pirelli, Edizione Holding and Olimpia entered into the Agreement with Bell
Shareholders, as discussed in Amendment No. 2 to the Statement on Schedule 13D.
Pursuant to the Hopa Term Sheet, the Parties agreed that, subject to certain
terms and conditions, Holy S.p.A ("Holy"), a company 100%-owned by Hopa, will be
merged into Olimpia (the "Merger"). Following the Merger, the share capital of
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Olimpia will be held by Pirelli, Edizione Holding, UCI, BCI and Hopa in the
following respective proportions: 50.4%, 16.8%, 8.4%, 8.4% and 16%. It is
expected that the Merger will be completed on or before April 30, 2003.
As discussed in press releases issued by Pirelli and Olimpia and a
background note for the media issued by Olivetti, copies of which are filed as
Exhibits 38, 39 and 40, respectively, the purpose of the Merger is to expand
Olimpia's shareholder base and thereby strengthen its financial structure.
Under the Hopa Term Sheet, at the time of the Merger the financial
characteristics of Olimpia, Holy and Holinvest must be as follows:
1. Olimpia's assets and liabilities shall substantially conform to
those set forth on Attachment A to the Hopa Term Sheet, subject to certain
exceptions noted in the Hopa Term Sheet.
2. Holy shall have no debt or liabilities and shall have a net worth
as recorded in its books of not less than euro 961.135 million through ownership
of the following: (i) 163,558,339 Olivetti Convertible Bonds; (ii) 99,941,661
Olivetti Shares; (iii) a 19.999% equity interest in Holinvest, the remaining
80.001% of which shall be held by Hopa; and (iv) net cash of euro 98.8 million
plus any dividends paid on the Olivetti Shares during the period from December
19, 2002 until the Merger.
3. Holinvest shall have assets consisting of (i) 163,558,339 Olimpia
Bonds; (ii) 134,721,109 Olivetti Convertible Bonds; and (iii) financial
instruments relating to 486,502,431 Olivetti Shares having the terms set forth
on Attachment B to the Hopa Term Sheet ("Olivetti Financial Instruments"). In
addition, Holinvest shall not have more than euro 721.75 million of financial
indebtedness (calculated in accordance with the Hopa Term Sheet) and shall have
an adjusted net worth of at least euro 220 million (calculated in accordance
with the Hopa Term Sheet).
The effectiveness of the agreement reflected in the Hopa Term Sheet
is subject to two conditions. The first condition is that, no later than
February 15, 2003, Holinvest will have the financial characteristics described
in paragraph (3) above. The second condition is that, no later than February 15,
2003, Holinvest, Hopa and the Hopa Controlling Companies referred to below will
have sold all Olivetti Shares held by them, subject to the following exceptions:
(i) Hopa may hold Olivetti Financial Instruments relating to a maximum of 40
million Olivetti Shares and (ii) each of the Hopa Controlling Companies may hold
a maximum of 1 million Olivetti Shares. The Hopa Controlling Companies consist
of Fingruppo Holding S.p.A., Banca Monte di Paschi de Siena S.p.A., Compagnia
Assicuratrice Unipol S.p.A., Banca Popolare di Lodi S.c.a.r.l. and other private
parties to an agreement regarding control of Hopa (the "Hopa Shareholders
Agreement"). The Parties agreed that, on or before February 15, 2003, the Hopa
Shareholders Agreement must be amended so that it will automatically terminate
as to any Hopa Controlling Company that holds more than 1 million Olivetti
Shares. The Parties also agreed that, in the aggregate, the number of Olivetti
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Shares held by Olimpia, the Present Olimpia Shareholders, Hopa, Holy, Holinvest
and the Hopa Controlling Companies may not at any time exceed 30% of Olivetti's
voting share capital.
The Parties agreed that, no later than January 31, 2003, they will
enter into definitive documentation reflecting the contents of the Hopa Term
Sheet (the "Definitive Agreements"). The Definitive Agreements will be described
in, and filed as exhibits to, a subsequent amendment to the Statement on
Schedule 13D.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
------------------------------------
The information contained in Items 3 and 4 above and Item 6 below is
incorporated herein by reference.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
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TO SECURITIES OF THE ISSUER
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HOPA TERM SHEET
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The description of the provisions of the Hopa Term Sheet contained in
Item 4 above is incorporated herein by reference.
Set forth below are descriptions of two shareholders agreements
contemplated by the Hopa Term Sheet. For a more detailed description of the
proposed provisions of these agreements, reference is made to the Hopa Term
Sheet filed as Exhibit 37.
PROPOSED EXPANDED OLIMPIA SHAREHOLDERS AGREEMENT
------------------------------------------------
The Hopa Term Sheet provides that, effective upon the Merger, Hopa
and the Present Olimpia Shareholders will enter into an agreement governing
their relationship as shareholders of Olimpia (the "Expanded Olimpia
Shareholders Agreement").
Under the Expanded Olimpia Shareholders Agreement, Hopa will have the
right to appoint one Olimpia director and the Present Olimpia Shareholders will
seek to elect one director of each of Olivetti, Telecom Italia, SEAT and TIM
nominated by Hopa (with a corresponding reduction in the number of Pirelli
nominees). Hopa's initial nominees are identified on Attachment C to the Hopa
Term Sheet; Hopa's selection of their successors will require Pirelli's consent,
which may not be unreasonably denied.
Hopa will not have the right to veto any decision taken by the board
of directors or shareholders of Olimpia. In the event of a disagreement over
certain specified transactions, the failure of Olimpia to maintain a debt to
equity ratio of 1:1 (which the Present Olimpia Shareholders will commit to
maintain, with Pirelli guaranteeing to furnish 80%, and Edizione Holding 20%, of
the necessary resources), or the occurrence of certain transactions involving
the disposition of Olimpia or Olivetti, Hopa may cause the partial demerger of
Olimpia, in which event Olimpia may cause the partial demerger of Holinvest. As
a result of these partial demerger transactions, Hopa will receive its
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proportional share of Olimpia's assets and liabilities (determined in accordance
with the Hopa Term Sheet) and Olimpia will receive its proportional share of
Holinvest's assets and liabilities (determined in accordance with the Hopa Term
Sheet). Except under certain extraordinary circumstances (including the failure
of Olimpia to hold at least 25% of Olivetti's share capital or to maintain a
debt to equity ratio of 1:1 after a specified cure period), the partial demerger
transactions may not be implemented prior to the third anniversary of the
Merger.
Hopa will have certain co-sale rights in the event Pirelli reduces
its equity interest in Olimpia.
Hopa, its controlled companies, the Hopa Controlling Companies, the
Present Olimpia Shareholders and their respective controlling and controlled
companies will agree not to acquire any additional Olivetti Shares except (i) in
the case of Pirelli, in connection with the exercise of the existing call
options and swap agreements referred to in Attachment D to the Hopa Term Sheet,
(ii) as currently permitted under the New Partners Agreement among Pirelli, UCI
and BCI or (iii) as currently permitted under the second amendment to the
Shareholders Agreement between Pirelli and Edizione Holding, described in
Amendment No. 10 to the Statement on Schedule 13D.
The Expanded Olimpia Shareholders Agreement will have a three-year
term, subject to extension by mutual agreement of the Parties. If the Expanded
Olimpia Shareholders Agreement is not renewed, the partial demerger transactions
will occur and Hopa will receive a premium of at least euro 0.35 per Olivetti
Share (or financial instrument).
PROPOSED HOLINVEST SHAREHOLDERS AGREEMENT
-----------------------------------------
The Hopa Term Sheet provides that, effective upon the Merger,
Holinvest's by-laws will be amended to limit its corporate purpose to holding
Olivetti securities and derivative financial instruments relating to Olivetti
Shares, and Olimpia and Hopa will enter into an agreement governing their
relationship as shareholders of Holinvest (the "Holinvest Shareholders
Agreement").
Under the Holinvest Shareholders Agreement, Olimpia will have the
right to designate one Holinvest director. For a period of 20 months following
the Merger, Hopa will not be permitted to dispose of its equity interest in
Holinvest and Holinvest must retain at least 65% of the Olimpia Bonds, Olivetti
Bonds and Olivetti Financial Instruments that it holds at the time of the
Merger. Thereafter, and for a period of two years after expiration of the
agreement, Olimpia will have a right of first refusal in the event Holinvest
wishes to sell its Olivetti Instruments.
The Holinvest Shareholders Agreement will have a three-year term,
subject to automatic extension if and to the extent the Expanded Olimpia
Shareholders Agreement is extended.
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ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
--------------------------------
37. Hopa Term Sheet, dated December 19, 2002 [English
translation]
38. Press Release, dated December 19, 2002, issued by
Pirelli [English translation]
39. Press Release, dated December 19, 2002, issued by
Olimpia [English translation]
40. Background note for the media issued by Olimpia on
December 22, 2002 [English translation]
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SIGNATURES
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After reasonable inquiry and to the best knowledge and belief of the
undersigned, the undersigned certify that the information set forth in this
statement is true, complete and correct.
Date: January 9, 2003
PIRELLI S.p.A.
By: /s/ Anna Chiara Svelto
-----------------------------------------
Name: Anna Chiara Svelto
Title: Attorney-in-fact
OLIMPIA S.p.A.
By: /s/ Luciano Gobbi
-----------------------------------------
Name: Luciano Gobbi
Title: Director and Attorney-in-fact
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EXHIBIT INDEX
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Exhibit No.
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37. Hopa Term Sheet, dated December 19, 2002 [English
translation]
38. Press Release, dated December 19, 2002, issued by
Pirelli [English translation]
39. Press Release, dated December 19, 2002, issued by
Olimpia [English Translation]
40. Background note for the media issued by Olimpia on
December 22, 2002 [English translation]
10