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KKR, CDP rival consortium submit new bids for Telecom Italia grid

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By Akriti Sharma and Elvira Pollina

MILAN (Reuters) -Telecom Italia (TIM) said on Friday it received two new offers for its landline grid as Italy’s biggest telecoms group seeks to resolve the impasse over the sale of its main asset.

U.S. fund KKR and a rival consortium comprising state lender CDP and Australian fund Macquarie separately submitted bids for Telecom Italia’s network, according to a statement.

Debt-crippled TIM had sought improved offers for its most valuable asset after having assessed as not yet adequate the proposals received in May.

“TIM announces that, as part of the competitive bidding process relating to Netco, two new non-binding offers have been received today,” the company said in a statement. It gave no details if the new bids were sweetened.

NetCo comprises TIM’s domestic fixed access network and international submarine cable unit Sparkle.

CDP and Macquarie have kept the economic value of their proposal close to their previous offer, suggesting a number of steps to address antitrust issues, two people close to the matter said.

The antitrust problems are linked to CDP and Macquarie’s owning fibre optic wholesale provider Open Fiber.

KKR, in turn, has indicated it could raise the value of its offer by more than 2 billion euros ($2.1 billion) depending on the terms of the contracts regulating NetCo’s ties with the rest of the business, another two people said, adding such terms would have to be negotiated with TIM.

TIM’s board is due to meet to review the proposals on June 19 and 22, the company said.

Treasury-owned CDP is the second-largest investor in TIM after France’s Vivendi with a 10% stake.

The network sale is a focal point of CEO Pietro Labriola’s plan to slash the former phone monopoly’s 26 billion euro debt pile and turn around the battered group.

($1 = 0.9305 euros)

(Reporting by Akriti Sharma in Bengaluru and Elvira Pollina in Milan;Editing by Marguerita Choy and Leslie Adler)

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