TIM board to review status of network deal talks on Friday – sources

ROME (Reuters) -Telecom Italia (TIM) will discuss a request from state lender CDP and its partners to extend a deadline to clinch a deal over the Italian phone group’s network at a special board meeting on Friday, two sources close to the matter said.

Initially scheduled for Oct. 26, the meeting of Telecom Italia’s board of directors has been postponed by two days, the sources said. One of the people said TIM CEO Pietro Labriola requested the delay to assess certain aspects of the potential deal before the meeting.

CDP, infrastructure fund Macquarie and Open Fiber are seeking more time to negotiate a deal to buy TIM’s network assets, pushing back an initial deadline for a binding deal set for the end of this month.

The potential multi-billion euro bid is part of a long-held plan to combine TIM’s fixed network assets with those of smaller rival Open Fiber to create a single national network operator under CDP’s control.

The grid sale is a key plank of the strategy set by Labriola to turn around the debt-laden former phone monopoly.

Earlier this month, TIM’s board failed to decide on setting a new deadline to clinch a binding deal, with representatives of top investor Vivendi unable to attend the meeting, sources said at that time.

Sources familiar with the matter told Reuters Vivendi also has some reservations about continuing talks with CDP on the network sale on an exclusive basis, an issue which could be a topic of discussion at the meeting on Friday.

Sponsored by the previous government of Mario Draghi, CDP’s plans to create a single broadband network champion will now have to be reviewed by a new right-wing government sworn in on Saturday.

The Brothers of Italy party, which leads the coalition, backs the creation of a unified network champion.

However, a party official has called on CDP to pursue a takeover of TIM, a move he argues would be cheaper for the state lender and offer more protection to TIM’s domestic workforce of more than 40,000.

(Reporting by Elvira Pollina, editing by Alvise Armellini and Keith Weir)