Infrastrutture Wireless Italiane (INW) Status update summary

Master Service Agreement (MSA) Structure and Legal Context

• The MSA is integral to the 2020 sale and leaseback transaction, ensuring long-term value and legal certainty for infrastructure investment.

• Change of control in August 2022 triggered a 16-year extension of the MSA, now expiring in 2038, with notifications exchanged between parties and preferred supplier rights for anchors.

• Fastweb issued a termination notice, which is considered unlawful and will be legally contested; the MSA remains valid until 2038 with no right of termination for Fastweb.

• Legal opinions support the current interpretation, but Fastweb disputes the extension, leading to arbitration proposals, ongoing legal proceedings, and expected court resolution by 2029.

• Attempts at amicable resolution, including arbitration and lawyer-assisted talks, were declined by Fastweb; INWIT seeks interim measures to maintain the MSA's validity.

Pricing, Economics, and Network Quality

• MSA fees are in line with European benchmarks, averaging €20,000 per point of presence, with about half attributed to financial components and a payback period of about 20 years.

• Anchor tenant fees are competitive and below European averages, with unique rights such as veto and reserved space.

• The sale and leaseback transaction was valued up to €5.7 billion, with a price per tower around €500,000.

• About 75% of the network is not replicable, with 35% unique and 40% non-alternative locations, offering strategic, high-quality sites.

• The network's consolidation reduces resource consumption and supports industry efficiency; duplicating infrastructure is seen as inefficient.

Inflation, Escalators, and Contract Flexibility

• The MSA includes an uncapped inflation-linked escalator, with average inflation from 2020-2025 at 2.9% and annual increases below 3%.

• INWIT is open to discussing mechanisms to reduce exposure to inflation spikes and optimize terms for new investments.

• Fee reductions requested by anchors are driven by inflation impacts and cost reduction goals, but INWIT seeks value-for-value negotiations.