The Italian government is not interested in buying a stake in Telecom Italia, but is reportedly monitoring the company closely given the growing influence of French investors.

Telecom Italia’s biggest shareholder is now France’s Vivendi, with a 20.1 per cent holding, while French tycoon Xavier Niel emerged as a surprise investor in October, and holds options to take a 15.1 per cent stake in the company.

The developments fuelled speculation that the government could buy its own stake in the operator through state holding Cassa Depositi e Prestiti (CDP).

A Reuters source said that while the government is not looking at buying a stake, it could exercise its veto power to safeguard the operator’s fixed network, Telecom Italia’s most prized asset.

There are concerns within the government, according to the publication, over Vivendi’s future intentions for the company in particular, and it is willing to take this step if needed.

The operator has long been seen as strategically valuable within the country, and governments in the past have blocked acquisition attempts by international companies.

Concerns were heightened internally after Vivendi submitted a formal request to add four of its executives to Telecom Italia’s board, with shareholders set to vote on the motion next week. An advisory proxy firm last week advised shareholders to vote against the proposal.

There is a also worry that Vivendi’s influential chairman Vincent Bollore could strike a deal with Mediaset, the broadcaster owned by former prime minister Silvio Berlusconi, as part of his ambitions to use the operator as a content distributor.

The government is however reluctant to acquire a stake as it could put it in direct blame over controversial decisions made by the operator, such as the potential sale of its mobile unit in Brazil.

Vivendi said last week its request to install executives on the board was intended to “add value to the already high quality” of the board, claiming it does not want to merge the two companies.