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Shares in Telecom Italia rise ahead of government meeting over single network plan

ROME, March 25 (Reuters) - Shares in Telecom Italia rose as much as 2% on Thursday ahead of a ministerial meeting that should provide clarity over the fate of Italy’s single network broadband project.

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 Telecom Italia’s landline grid assets.

But the plan, championed by the Treasury under former Prime Minister Giuseppe Conte, was never finalised.

Concerns about the project losing traction under new Prime Minister Mario Draghi’s government have weighed on Telecom Italia’s shares recently.

After pouring cold water on the plan, late on Wednesday Industry Minister Giancarlo Giorgetti said it was still “relevant.”

Such comments “are supportive to the process already underway. The commitment to accelerate the process is also positive news,” Intesa Sanpaolo analysts said in a note.

Giorgetti urged the companies involved to clarify their stance so as to reach a decision before Easter on whether the project can go ahead.

Giorgetti will meet on Thursday afternoon with Economy Minister Daniele Franco and Innovation Minister Vittorio Colao to discuss the single network plan, two government sources said.

TIM shares were up 1.4% at 1138 GMT outperforming a 0.3% rise in Europe’s telecoms sector.

Under the plan backed by the previous government, TIM could initially own more than 50% if the value of the assets folded into the new player justified it, but would need to grant equal access to all market players. The final say on strategic issues would lie with the CDP.

CDP is also TIM’s second largest shareholder, behind French media giant Vivendi. (Reporting by Giuseppe Fonte, Elvira Pollina and Giancarlo Navach, editing by Valentina Za and Susan Fenton)

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