CORRECTED - UPDATE 4-Telecom Italia told to sell Argentine assets

(In fifth paragraph, corrects to add that Telecom Italia is controlled by a group of other shareholders in addition to Telefonica)

* Antitrust commission to force sale

* Ruling aims to generate better services and prices

* Telecom Italia shares rise 0.72 percent (Recasts; adds analyst, Telecom Argentina share price)

By Fiona Ortiz

BUENOS AIRES, Aug 27 (Reuters) - Argentina's antitrust commission said on Thursday that Italy's Telecom Italia (TLIT.MI) must sell its Argentine telephone holdings to prevent another European company from controlling the sector.

The Italian company is expected to fight the ruling even though it has already said it is interested in selling its stake in one of Argentina's two main telephone companies, Telecom Argentina (TEO.N) (TEC2.BA), an analyst said.

"We've reached a very important resolution that is also very well founded," Humberto Guardia, vice president of the Competition Defense Commission, or CNDC, told Radio 10.

Guardia said he expects courts to uphold the ruling, which stems from an investigation into the holdings of Spain's Telefonica (TEF.MC) in Argentina's two top phone companies.

The Spanish company controls telephone company Telefonica Argentina TEA2.BA and -- through affiliate Telecom Italia, which it controls with a group of other shareholders -- also has an indirect stake in rival operator Telecom Argentina.

Telecom Italia, Italy's No. 1 telecom operator, was not immediately available to comment, and a spokeswoman for Telecom Argentina said the company's policy is not to comment on the CNDC investigation.

COMPETITION

Telecom Italia will most likely fight the ruling in the courts, as it has earlier decisions such as a freeze on its call option on Telecom Argentina, said Juan Pablo Vera, head of financial analysis at Tavelli brokerage in Buenos Aires.

He said the ruling did not have a big impact on share prices of Telecom Italia, which closed 0.72 percent higher at 1.126 euros per share, or Telecom Argentina, which was off 1.3 percent at 11.2 pesos per share.

"The impact on the price will be really different when we really know if Telecom Italia has to disinvest and at what price," Vera said.

Guardia of the CNDC said Telecom Italia will have a year to sell, and the ruling will guarantee competition in Argentine telecommunications so that consumers get better services and prices.

Telecom Italia previously said it had considered selling its stake in its Argentine company due to the antitrust probe. Telecom Italia owns half of Sofora Telecomunicaciones SA, the holding company that controls Telecom Argentina.

Argentina's Werthein family investment group has the other half of Sofora and has expressed interest in buying out Telecom Italia, but Vera said the two parties have been unable to agree on a price. (Additional reporting by Guido Nejamkis and Stephen Jewkes in Milan, editing by Gerald E. McCormick)