Shareholders in the consortium that controls Telecom Italia earlier this month rejected an €800 million offer from Telefonica to purchase some of their stakes, said Il Sole 24 Ore.

The report, which was not sourced, said the Spanish operator had asked its Italian partners to retain some of their shares in the controlling Telco group, to avoid regulatory issues in Latin America, where Telefonica and Telecom Italia are rivals.

The Spanish operator is the largest shareholder in Telco, which also includes local banks Intesa Sanpaolo and Mediobanca, and insurance firm Generali. Telco holds a 22.4 per cent interest in Telecom Italia.

The offer was made earlier this month, the report said, but the Italian shareholders rejected it.

Meanwhile, Telecom Italia has delayed a board meeting due later this week (19 September), which was expected to discuss a potential reorganisation. The meeting has been postponed until 3 October.

Shareholders still plan to meet informally this week, says Bloomberg. Among the matters under discussion will be the pact between the shareholders of Telco. Their agreement runs out on 28 September, although they can choose to renew it.

The Italian government is thought to favour a more prominent role for Telefonica, another European operator, ahead of other names which have been linked to Telecom Italia. Potential suitors have included AT&T, Naguib Sawiris and Hutchison Whampoa.

Telefonica has come under pressure to act because the core Italian shareholders in Telco want to sell their stakes.