(Adds quotes from chairman on spin-off process)
MILAN May 9 A proposed spin-off of Telecom
Italia's domestic phone lines, its most valuable
asset, that could open up the network to rivals would take time
to execute, its chairman said.
Putting the fixed-line assets into a separate company could
also pave the way for an eventual sale of a minority stake in
the network, which is estimated to be worth 12-15 billion euros
Splitting off the fixed lines would give all telecom
operators equal access to the network - a European Union
requirement - radically changing the Italian market, chairman
Franco Bernabe said on Thursday.
The move could help Telecom Italia, Italy's biggest phone
group by market share, free up resources to cut its more than 28
billion euros of debt and fund investment.
Telecom Italia's board will meet on May 23 to decide whether
to go ahead with the separation.
"It's a complex process and will require a long time to be
implemented," Bernabe told analysts on a conference call.
It was too early to say if any deal, which would have to be
discussed with government and regulators, might be completed
this year, he said.
Bernabe said Telecom Italia could sell a minority stake in
the network to state-backed financing body Cassa Depositi e
Prestiti (CDP) after a separation.
He ruled out the sale of a majority stake.
A deal with the CDP could help smooth a potential tie-up
between the Italian firm and Hong Kong-based conglomerate
Hutchison Whampoa because it would assuage government
concerns about the national network falling into foreign hands.
He declined to comment on the possibility of a stock market
listing for the network company.
($1 = 0.7591 euros)
(Reporting By Danilo Masoni; Editing by Erica Billingham)