Telecom Italia agrees to separate fixed-line network

Telecom Italia has agreed to separate its fixed-line network into a new business as the group continues to consider a proposal to merge its mobile operations with Hong Kong’s Hutchison Whampoa.

The company’s board voted in favor of plans to create a separate company that would own the copper and fiber-line network. That company would, at least initially, be wholly controlled by Telecom Italia. The separation is the first step to a sale of a minority stake in the business to Cassa Depositi e Prestiti, a state-backed fund, which would help raise cash for heavily indebted Telecom Italia.