UPDATE 1-China State Grid deal will not affect Terna expansion plans
* No evidence of governance problems from China Grid-Terna CEO
* Binding bids for Greek grid due after summer-CEO
* Terna H1 core earnings 753 mln euros vs forecast 746 mln (Recasts lead, adds management comments)
MILAN, July 24 (Reuters) - Italy's plans to sell a stake in its energy grid holding company to China's State Grid Corp will not affect the strategy or international expansion of power grid Terna, its CEO said on Thursday.
State Grid Corp of China is in advanced talks with Italy's investment agency Cassa Depositi e Prestiti (CDP) to buy a 35 percent stake in its network holding company CDP Reti in a deal that could be worth some two billion euros.
CDP Reti, wholly-owned by CDP, is also due to take control of a 29.9 percent stake in power grid company Terna.
Both Terna and China's State Grid Corp are interested in a 66 percent stake in Greece's state-owned power company ADMIE, which the government in Athens is putting up for sale. But the CDP Reti deal could create tensions between these rival bidders.
Terna Chief Executive Matteo Del Fante said the move by the Chinese company, the world's biggest state utility, would not threaten his group's plans to expand outside its home market or its broader strategic objectives.
"I have no evidence of any potential impact on governance issues from China State Grid ... It will have no impact on strategy," he said in a conference call on Terna's first half results.
Del Fante said the Greek grid would look at the conflict issue when it came to certify the profiles of different bidders for its network. He declined to answer a question on the possibility of joint bid for the Greek grid by Terna and China's State Grid Corp.
Terna is keen to win control of the Greek power network as it looks to beef up its presence outside Italy.
Del Fante said Terna was one of four bidders admitted to the due diligence phase of the bid for ADMIE. "Final binding bids are due after the summer. Completion of the deal is 2015 business," he said.
Terna is investing in projects outside its core business of running the Italian power network to boost profits and increase returns for its shareholders.
Earlier on Thursday, Terna said its core earnings in the first half rose 2.8 percent on the year to 753 million euros ($1 billion) boosted by non-core business.
($1 = 0.7427 Euros) (Reporting by Stephen Jewkes; editing by Oleg Vukmanovic and Jane Merriman)