Telecom Italia eyes Italy restructuring, halts network plan

Credit: Reuters

MILAN/ROME (Reuters) – Telecom Italia’s new chief executive Marco Patuano will unveil a business plan outlining the future of its South American units and a possible corporate restructuring in Italy at a board meeting on November 7, trade union officials said.

Patuano told a meeting with unions on Friday the heavily indebted former phone monopoly had put on hold a plan to spin off its fixed-line network because the right regulatory conditions were not in place, they said in a joint statement.

Patuano told unions that any corporate restructuring of its domestic operations would be done only if it creates values for the company, according to the statement.

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The unions said the reorganisation could lead to a breakup of the company, a move which they see as a prelude of possible job cuts, and reiterated their opposition to the network separation plan.

Telecom Italia, burdened by nearly 29 billion euros of net debt and a deep recession in Italy, said in a statement the company would respect terms of a 2013 agreement with the unions, and that it would continue to invest to revive its business.

Patuano was named CEO on Thursday after long-standing executive chairman Franco Bernabe resigned in a strategy clash with core shareholders, fuelling expectations of possible asset sales.

Bernabe resigned after his plans to raise funds for badly needed investment through a large share issue were rejected by controlling shareholders led by Spain’s Telefonica.

Fistel-Cisl union leader Giorgio Serao said, after the meeting with Patuano at which he was present, a decision on the group’s Brazilian unit Tim Participacoes and Telecom Argentina will be outlined under the new plan.


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