28/01/2010 By Giada Zampano and Gilles Castonguay ( Source: http://online.wsj.com )

Telecom Italia Network To Remain Italian - Govt Official

Telecom Italia SpA's (TIT.MI) fixed-line network can't be expropriated even if the operator were to merge with Spain's Telefonica SA (TEF.MC), according to Telecommunications Undersecretary Paolo Romani.

It wasn't clear whether Romani was referring to expropriation by the government or by Telefonica, but Romani said: "The network is and will always stay Italian."

The former monopoly operator's network, the country's largest, is considered by politicians as a strategic asset for the country and they are loathe to see it fall into the hands of a foreign operator.

"It's obvious that even in the case of a merger between Telecom Italia and Telefonica, the Telecom Italia network cannot be expropriated," Romani said in a speech at a telecommunications event in parliament.

As a shareholder of Telecom Italia, Telefonica has been the subject of speculation both in the market and the local press about a possible merger with the Italian operator.

Separating the network from Telecom Italia has also been an idea considered by politicians.