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Italian minister calls Vivendi ‘awful’ investor in Telecom Italia

MILAN (Reuters) – Vivendi has been an “awful” investor in Telecom Italia (TIM) , Italy’s outgoing Industry Minister Carlo Calenda told la Repubblica daily on Monday, as the French media group fights to keep its grip on Italy’s biggest phone group.

FILE PHOTO: A logo is seen over the main entrance of the entertainment-to-telecoms conglomerate Vivendi’s headquarters in Paris April 8, 2015. REUTERS/Gonzalo Fuentes/File Photo

“I am in favor of foreign investments, but this does not mean standing aside when they destroy value rather than creating it, especially when there’s a strategic interest at stake,” Calenda said in the interview.

Vivendi was not immediately available for comment.

TIM has lost a quarter of its market value since Vivendi, the group’s largest shareholder with just under 24 percent, first took a stake in the middle of 2015.

Vivendi’s management of the company has led to tensions with the Italian government and Rome eventually decided to use its so-called “golden powers” to ensure it had a say in some key decisions.

Vivendi is also facing a challenge from activist hedge fund Elliott, which has a 9 percent stake, and wants to make changes to the board.

Increasing its influence, the government also bought a 4.262 percent stake in the group through its investment arm Cassa Depositi e Prestiti (CDP).

The investment through CDP follows a decision by TIM to put its network, which analysts have valued at up to 15 billion euros, into a legally separate company, fully controlled by the phone incumbent.

Calenda defended CDP’s move and added that Italy should have a single telecoms network.

“CDP has intervened to support a project to turn Telecom Italia into a (genuine) public company and spin off the network,” the minister said, adding that CDP did not want to take control of the company.

Calenda remains in his ministerial post pending efforts to end a political stalemate following a national election last month.

Some politicians and Elliott have advocated the creation of a single national network via the merger of Telecom Italia’s NetCo with rival Open Fiber, a broadband firm jointly owned by the CDP and state-controlled utility Enel.

Reporting by Francesca Landini in Milan; Editing by Robin Pomeroy/Keith Weir

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