CK Hutchison's Italian Unit Under Investigation for Tax Evasion Allegations

Investing.com -- CK Hutchison Holdings Ltd.'s telecommunications subsidiary in Italy, Wind Tre SpA, is under investigation for alleged tax evasion during a $3.6 billion asset sale to Cellnex Telecom SA. The investigation focuses on allegations that Wind Tre, Italy's third-largest phone company, failed to pay registration taxes during the sale of thousands of mobile phone towers to the Barcelona-based Cellnex.

According to a document seen by Bloomberg, the alleged tax evasion is estimated to amount to approximately €132 million ($144 million) for the year 2022. The document suggests that Wind Tre executives employed a complex asset sale structure involving Luxembourg-based CK Hutchison Europe Investments Sarl to reduce the company's tax burden in Italy.

The document highlights that the financial police pointed out that the tower sale agreement led to an "unjust optimization of the overall tax burden concerning registration and income taxes." The investigation into these claims began last year, and Wind Tre received its full audit report in October.

In response to the allegations, Wind Tre stated in a comment to Bloomberg that the transaction was executed "in full compliance with existing tax laws." The company also indicated that it is cooperating with tax authorities regarding the ongoing investigation. Wind Tre's parent company, CK Hutchison, did not immediately respond to requests for comment. Both the Italian financial police and a Cellnex representative declined to comment on the matter.