Disclosure of delayed confidential information – commencement of negotiations by shareholders of TIM S.A.

Date of preparation	24/03/2023
Current report no.	13/2023

 

The Management Board of TIM S.A. ‘the Company’, acting pursuant to Article 17 section 1 in connection with Article 17 section 4 of the Regulation of the European Parliament and of the Council of the EU No. 596/2014 ‘MAR Regulation’, communicates the following confidential information concerning the commencement by the Company’s Shareholders – Krzysztof Folta, Ewa Folta, Piotr Nosal, Piotr Tokarczuk, Krzysztof Wieczorkowski and Maciej Posadzy of negotiations with Adolf Würth GmbH Co. KG concerning the sale of the Company’s shares held by the Shareholders.

The public disclosure of the following confidential information was delayed on 28.02.2023 pursuant to Article 17 section 4 of the MAR Regulation.

The content of the delayed Confidential Information ‘Confidential Information’:

The Management Board of TIM S.A. ‘Company’ informs that on 28 February 2023 , it received information that Krzysztof Folta, Ewa Folta, Piotr Nosal, Piotr Tokarczuk, Krzysztof Wieczorkowski and Maciej Posadzy ‘Shareholders’ started negotiations with Adolf Würth GmbH Co. KG ‘Investor’ regarding the sale of the Company’s shares by the Shareholders to the Investor ‘Negotiations’. The commencement of the Negotiations is the result of the Investor’s offer to acquire the Company’s shares as part of the ongoing review of strategic options regarding the future of the TIM Group, which the Company announced in current report No. 23/2022 on 22 August 2022 ‘Strategic Options Overview’. Upon the commencement of the Negotiations, the Shareholders undertook to the Investor that, until 26 March 2023, they shall not continue or commence negotiations with entities other than the Investor regarding the disposal of shares in the Company or all or a material part of the Company’s assets as well as that they shall not complete such transaction and shall not make available to any other entity information regarding the Company for the purpose of such a transaction. In the event that the transaction that is the subject of the Investor Negotiations is not completed by 26 March 2023, the above commitment of the Shareholders shall continue for a further two-month period unless terminated by the Shareholders on two weeks’ notice.

According to information obtained by the Company, the Negotiation process is at an early stage and the outcome and likelihood of a positive conclusion are uncertain. The achievement of the purpose of the Negotiation depends on external factors beyond the Company’s control.

The Company shall announce receipt of information on the next steps in the Negotiations in separate current reports.

The commencement of the Negotiations does not affect the terms, assumptions or early completion of the ‘Strategic Option Overview’.

Rationale for the delay in communicating the Confidential Information to the public

In the opinion of the Management Board of the Company, the delay in disclosing the Confidential Information to the public at the time of the decision to delay met the conditions set out in the MAR Regulation and the guidelines of the European Securities and Markets Authority published on 13 April 2022.

In the opinion of the Management Board of the Company, the immediate disclosure of the information on the commencement of negotiations on the possibility of the Shareholders’ disposal of the Company’s shares constituted a risk of infringement of the Company’s legitimate interests by the possible negative impact of such action on the course and outcome of the Negotiation process and the likelihood of the transaction constituting its subject.

In the opinion of the Management Board of the Company, immediate disclosure of information on the commencement of negotiations on the possible sale of the Company’s shares by the Shareholders constituted a risk of violation of the Company’s legitimate interests by a negative impact on the course and outcome of the Negotiations process, in particular the possibility to deteriorate the Shareholders’ negotiating position and, consequently, adversely affect the Company’s ability to achieve its business objectives under the Strategic Option Overview. It cannot be ruled out that public disclosure of information on the commencement of the Negotiations could result in an attempt to disrupt the course of the Negotiations by third parties, including in particular parties engaged in activities which are in competition with the Company. Furthermore, in the Management Board’s opinion, disclosure of information at the stage of commencement of talks with a potential investor could even lead to the impossibility of successful conclusion of the Negotiations, as immediate disclosure of confidential information could also have a speculative impact on the Company’s share price. Moreover, the speculative and negative development of the Company’s share price resulting from the disclosure of information on the commencement of negotiations would also affect the perception of the Company on the financial markets. In view of the above, in the Company’s opinion, immediate disclosure of information on the commencement of negotiations could infringe upon the legally justified interests of the Company and its present shareholders in such a way that immediate disclosure of such information could adversely affect their successful outcome.

In the Management Board’s opinion, there were also no circumstances indicating that the delay of the Confidential Information could mislead the public, in particular, due to the lack of previous public announcements by the Company on the matter to which the delayed Confidential Information relates, the Strategic Option Overview communication did not directly refer to the possibility of the sale of the Company’s shares by the Shareholders, the possibility of entering into a transaction with the Investor or the possibility of conducting Negotiations with the Investor.

The Company was also not aware of any positions or statements made by other Participants in the market which would firmly and categorically exclude the possibility that the Shareholders could negotiate with the Investor or enter into a transaction with the Investor.

In view of the above, in the Company’s opinion, the Confidential Information did not contrast with market expectations and did not contradict the existing information message known to the Participants and, therefore, there were no grounds to conclude that a delay in the public disclosure of the Confidential Information could mislead the public.

The Company also ensured due protection of the Confidential Information, in particular the protection under the applicable laws and internal procedures, by providing appropriate information barriers put in place internally and in relation to third parties.

Access to Confidential Information was granted on the part of the Company only to persons whose access to this information was necessary for the performance of their professional duties. All the aforementioned persons were included in the list of persons having access to confidential information, which was monitored on an ongoing basis and updated as necessary, instructed on the rules of confidentiality and the administrative and criminal sanctions associated with the unlawful use or disclosure of such information.

SIGNATURES OF THE COMPANY REPRESENTATIVES

24/03/2023, Krzysztof Folta – President of the Management Board 24/03/2023, Piotr Tokarczuk – Member of the Management Board