UPDATE 1-Unipol wants Fondiaria merger proposal simplified
* Unipol wants 67 pct of new firm vs 61 pct Fondiaria proposal
* Unipol board to meet on Tuesday
* Cash call underwriting banks remain committed
MILAN, June 4 (Reuters) - Insurer Unipol said on Monday the share swap ratio proposed by troubled peer Fondiaria-SAI as part of plans for the two groups to merge and create Italy's No. 2 insurance company can be changed.
"It's a bit complex. It can be simplified," Unipol Chief Executive Carlo Cimbri told reporters.
Unipol has agreed a 1.7 billion euro ($2.12 billion) plan brokered by top investment house Mediobanca to rescue loss-making Fondiaria.
The deal, first signed in January, involves Unipol merging with Fondiaria, its debt-ridden parent Premafin and its unit Milano Assicurazioni. It sees two cash calls of 1.1 billion euros each at Unipol and Fondiaria.
The plan is under regulatory scrutiny after hitting several hurdles, including disagreements over swap ratios.
Unipol, controlled by a group of co-operatives, has said it wants some 67 percent of the new insurance group, while Fondiaria has proposed only 61 percent.
The board of Unipol is due to meet on Tuesday to discuss the Fondiaria proposal, Cimbri said.
As haggling between the two sides grows, concern is mounting a delay to the capital increases, which are needed to shore up ravaged balance sheets, could prompt insurance regulator ISVAP to place Fondiaria under special administration.
Mediobanca, the largest shareholder of Italy's biggest insurer, Assicurazioni Generali, holds more than 1 billion euros of debt run up by Fondiaria and is leading the underwriting consortium for the merger.
Sources said on Monday the banks underwriting the capital increases at Unipol and Fondiaria were still committed to the operation despite a May 31 deadline having passed.
Concern had been growing that some of the banks might pull out of the deal because of market turmoil in Italy.
"Credit Suisse is continuing to look at this operation with great interest," a source at the Swiss bank said on Monday.
Another source close to the pool of banks said that the lenders were continuing to work on the plans.
The underwriting consortium for the merger include Mediobanca, Barclays, Credit Suisse, Deutsche Bank, Morgan Stanley, Nomura, UBS and UniCredit CIB.
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