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Telecom Italia shares drop as uncertainty clouds single network project

Telecom Italia shares drop as uncertainty clouds single network project

MILAN (Reuters) – Shares in Telecom Italia fell 5% with traders in Milan citing uncertainty over the single broadband network project after comments in past days by ministers in the government led by Mario Draghi.

Rome has been trying to create a national network by merging Open Fiber, a small broadband operator owned by state lender CDP and utility Enel, with the landline grid assets of former phone monopoly Telecom Italia (TIM).

But the plan, for which TIM and CDP struck a preliminary accord last year, has not been finalised yet as negotiations between parties stalled.

“There is contrasting news and a bit of confusion regarding the single-network project,” a Milan-based trader said.

The stock was the top loser on Italy’s blue chip index, down 4.67% at 0900 GMT.

Industry Minister Giancarlo Giorgetti said on Wednesday Italy will re-examine the previous government’s planned single broadband network project to ensure it is feasible, adding it would make sense only if the network were under state control.

Innovation minister Vittorio Colao on Thursday called for the stalemate over the long-delayed project to be resolved as soon as possible in order to avoid holding up its broadband rollout plan.

He also said the government was considering alternative options to ensure super fast broadband connection across the whole country by 2026.

(Reporting by Giancarlo Navach and Elvira Pollina, writing by Giulia Segreti)

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