UPDATE 1-Telecom Italia picking funds for fiber network deal as debt falls

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    By Elvira Pollina
    MILAN, Nov 7 (Reuters) - Telecom Italia (TIM) said
on Thursday it has made progress in cutting its debt burden as
it presses ahead with plans to find an investment partner to
help it fund a potential tie-up with smaller rival Open Fiber.
    In a statement on nine-month results the former phone
monopolist said it had cut its debt by almost one billion euros
from end-2018 to 24.3 billion euros ($26.85 billion), meeting
its full-year target three months ahead of time.
    The company confirmed its three-year guidance and said its
organic earnings before interest, tax, depreciation and
amortisation (EBITDA) after leases fell 4.3% to 1.9 billion
euros in the three months ending September, broadly in line with
company-provided consensus.
    Revenues in the third quarter fell by 6.1% to 4.429 billion
euros, below expectations for 4.518 billion euros, as stiffer
competition in its domestic market continued to take its toll.
    Cutting the mountain of debt is one of the main objectives
Chief Executive Luigi Gubitosi set for the group in his recent
three-year business plan.
    An easing of tensions between the group's top investors,
French conglomerate Vivendi and U.S. activist fund
Elliott, which took control of the board last year, could help
Gubitosi deliver on promises.
    Since taking over at TIM, the veteran manager has been
looking for ways to engineer a deal with Open Fiber to create a
national broadband champion. 
    In its results statement, TIM said it was in the process of
picking one or more infrastructure funds to help its plans with
Open Fiber, confirming what sources had previously told Reuters.

    Also on Thursday, TIM agreed a partnership with Spanish
lender Banco Santander to set up a consumer credit
joint venture, aimed at reducing credit risk and boosting cash
    TIM also said it was setting up a new vehicle to hold its
data centre assets. A source recently said TIM was considering a
possible spin-off and listing of its data centre business.


($1 = 0.9051 euros)

 (Reporting by Elvira Pollina, editing by Stephen Jewkes and
Rosalba O'Brien)