Italian state lender Cassa Depositi e Prestiti (CDP) announced it would increase its 5 per cent stake in Telecom Italia without revealing further details, though Reuters reported it is looking for a 10 per cent ownership.

“The Board of CDP…has resolved to authorise the purchase of further shares of Telecom Italia” the lender said, adding the move is “consistent with CDP’s mission to support national strategic infrastructures and aims at supporting the development and value creation process started by the company in a sector of primary interest for the country”.

Sources told Reuters it will increase its stake to 10 per cent in the next 12 months.

CDP is controlled by the Italian treasury and owns 50 per cent of Open Fiber, a Telecom Italia rival which is building a fibre broadband network, the news agency added.

Telecom Italia’s domestic business faced issues in 2018 due to a boardroom battle between its largest shareholder, Vivendi, and activist shareholder Elliott Management, which are both wrangling for power.

Last month the operator warned earnings for 2018 in its domestic business are expected to be lower compared with 2017.