Telecom Italia shares drop as uncertainty clouds single network project

FILE PHOTO: A Telecom Italia’s control unit for fiber optics is seen in Perugia, Italy, June 23, 2017. REUTERS/Alessandro Bianchi/File Photo

MILAN (Reuters) – Shares in Telecom Italia fell 5% on Friday, with traders in Milan citing uncertainty over Italy’s single broadband network project after recent comments from ministers.

Rome has been trying to create a national network by merging Open Fiber, a small broadband operator owned by state lender CDP and utility Enel, with the landline grid assets of former phone monopoly Telecom Italia (TIM).

But the plan, for which TIM and CDP struck a preliminary accord last year, has not been finalised as negotiations between parties stalled.

“There is contrasting news and a bit of confusion regarding the single network project,” one trader said.

TIM was the top loser on Italy’s blue chip index, down 4.67% at 0900 GMT.

Industry Minister Giancarlo Giorgetti said on Wednesday Italy would re-examine the previous government’s planned single broadband network project to ensure it was feasible, adding it would only make sense if the network was under state control.

Innovation minister Vittorio Colao on Thursday called for the stalemate to be resolved as soon as possible in order to avoid holding up the broadband rollout plan.

He also said the government was considering alternative options to ensure super fast broadband connection across the whole country by 2026.

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