Olivetti takes $2bn loan to pay debt

NEWS Its investment banker, Lehman Brothers, has upped its stake in the company to 'between 2 and 3 per cent', worth between $356m and $400m. The bank was advisor last year when Olivetti took controlling interest in Telecom Italia. Olivetti claims the move, when combined with the $2.23bn raised from September's convertible bond issue, will cut debt servicing costs by up to a third. Olivetti is currently paying four to six per cent interest on debt. The figure will now be reduced to between one and two per cent. In 1995, Lehman took a stake in Olivetti in return for its eight per cent share in Italian mobile operator Omnitel. Olivetti then sold this to Mannesmann for $200m and paid Lehman over half. Olivetti expects to break even for the year 2000, with net revenues of $712m. Last week, Telecom Italia said it expects earnings before charges to be up seven per cent on the previous year, to $11.57bn.