Telecom Italia shares fall on dividend concerns
MILAN Oct 25 (Reuters) - Shares in Telecom Italia fell nearly 5 percent in late morning trade on Friday amid market concerns the phone company could scrap its dividend to fix its heavily indebted balance sheet.
"The stock is suffering from speculation the dividend could be scrapped," one trader said.
Telecom Italia was not immediately available for comment.
Another trader said cutting the dividend would make sense given the company's needs to reduce its nearly 29 billion-euro ($40 billion) net debt pile.
By 0945 GMT, the stock was halted limit-down after falling 4.9 percent to 0.6825 euros.
The stock has risen 36 percent in the last three months amid speculation of ownership changes and possible asset disposals.
Italian newspaper Corriere della Sera said if a rights issue was not pursued, cutting the dividend could be one of group's options to raise funds.
($1 = 0.7245 euros) (Reporting by Claudia Cristoferi, editing by Danilo Masoni)
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