LONDON, April 14 (Reuters) - Egyptian billionaire Naguib Sawiris wants to invest up to $2 billion in Telecom Italia if its biggest shareholder Telefonica pulls out of the Italian group, a source familiar with the matter said on Monday.
Sawiris made an unsuccessful attempt to buy a stake in Telecom Italia in 2012 and said the company needed cash for investments.
The source confirmed a report in Sunday's Il Sole 24 Ore newspaper that Sawiris is interested in making a fresh bid but said that an imminent approach is unlikely.
"I don't expect things to move in the short term," the source said. "Telecom Italia still looks too expensive for Naguib."
Sawiris has also been critical of the involvement of Spain's Telefonica in Telecom Italia because of conflicting interests in Brazil.
Telefonica, together with three Italian financial institutions, controls 22.4 percent of Telecom Italia through holding company Telco and is a direct rival of Telecom Italia in Brazil through its ownership of market-leading mobile operator Vivo.
Sources close to Telefonica have said the group would like to break up Telecom Italia's Brazilian business TIM Brasil , while the Brazilian competition watchdog has given Telefonica until mid-2015 to reduce its presence in the country, other sources have said.
If Telefonica fails to engineer a break-up of TIM Brasil it might have to consider selling its 15 percent stake in Telecom Italia to comply with the Brazilian authority's demands.
Telefonica' Italian partners have signalled that they could break up Telco in the coming months and eventually sell their stakes in Telecom Italia, weakening the Spanish group's grip on the Italian company.
Telecom Italia, which is due to appoint a new board next week, is carrying out a 4 billion euro ($5.56 billion) plan to cut debt and fund investments as it seeks to reverse years of sluggish growth. ($1 = 0.7201 Euros) (Editing by David Goodman)