April 27, 2013 / 1:17 PM / 4 years ago

Telecom Italia may float off fixed-line network-newspaper

* Listing plan still lacking details - newspaper

* IPO would meet strong investor demand - source

MILAN, April 27 (Reuters) - Telecom Italia could float its valuable Italian fixed-line network on the stockmarket to keep it separate from any possible tie-up with Hutchison Whampoa, an Italian newspaper said in an unsourced report on Saturday.

Italy’s former monopoly telecoms operator earlier this month appointed a panel of directors to look at a possible tie-up with the Hong Kong-based group and also asked its management to look into the feasibility of spinning off the network.

Daily Il Messaggero said the plan for a separate listing for the fixed line network, which still has to be defined in detail, would see Italian state-backed fund Cassa Depositi e Prestiti (CDP) taking up a stake and would be carried out in a relatively short period of time.

No one at Telecom Italia could be reached immediately for comment.

Sources have told Reuters that the planned tie-up could see Hutchison owning 29.9 percent of Telecom Italia in return for selling its 3 Italia mobile business to the Italian group and buying out some core shareholders.

Excluding the fixed-line network from the deal would avoid a major political hurdle. Italian politicians have voiced opposition to foreign ownership of an asset deemed to be of strategic national importance.

Telecom Italia has been in talks for months to separate its domestic fixed-line network into a new company in which CDP would buy a significant minority stake.

But disagreements over governance issues and the valuation of the network, which by some estimates could be worth 12 billion to 15 billion euros ($15.6-19.5 billion), have made it difficult to reach a deal.

But a source familiar with the matter has told Reuters that a listing of the fixed line network would meet strong investor demand.

A public share offer would also help the parties settle differences over price, Il Messaggero said.

Telecom Italia is expected to decide on whether to pursue talks with Hutchison by the time of its next board meeting on May 8. ($1=0.7676 euros) (Reporting By Danilo Masoni; Editing by Greg Mahlich)

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