Telecom Italia reportedly hopes to get a valuation of around €20 billion for its fixed-line network, which the operator plans to sell to state lender CDP and investors and merge with Open Fiber to create a single fibre company.

Bloomberg reported the valuation is preliminary and could change. Telecom Italia reportedly intends to use the proceeds to cut its debt and fund a turnaround plan proposed earlier this year by CEO Pietro Labriola.

Reuters also reported CDP could take a 70 per cent to 77 per cent stake in the combined broadband network operator. US investor KKR is expected to hold a 12 per cent to 15 per cent stake, while Australia-headquartered Macquarie Asset Management’s future shareholding is estimated at 10 per cent to 13 per cent.

Telecom Italia’s fixed network is valued by analysts at between €15 billion and €20 billion, the news agency noted.

The latest reports come two days after Telecom Italia signed a preliminary deal with CDP to combine its fixed assets with those of Open Fiber. The agreement was backed by KKR and Macquarie Asset Management, which hold stakes in Telecom Italia’s FiberCop fixed-line business and Open Fiber, respectively.

Earlier this year, Labriola outlined a plan to separate the Italian operator into two units by splitting infrastructure assets from services operations.