Italy's Telecom (TIM) wins $1.2 billion in government compensation, plans to advance equity structure reform and restore dividends

The Italian Supreme Court ruled that the government must repay TIM approximately €1.02 billion (USD 1.2 billion), ending a licensing fee dispute that lasted over 20 years. The compensation includes the original principal and accumulated interest over the years. This move will greatly alleviate TIM's cash flow pressure, helping it to potentially resume dividends that were interrupted since 2022. The CEO plans to use these funds to convert the "savings shares," which account for 28% of the company's capital, into common stock, simplifying the company's equity structure. The Italian government has already set aside provisions for the related litigation in the 2026 budget, so the compensation will have a limited impact on Italy's deficit reduction plans. The dispute originated after the liberalization of the telecommunications industry in 1998, when TIM sued the government for compensation for the license fees paid at that time