A panel of directors appointed by Telecom Italia to advise on a possible link-up with Hutchison Whampoa’s local unit has been unable to reach a common decision, according to a number of media reports.

The group are divided on the best way to proceed and so will not make any firm proposal at Telecom Italia’s board meeting today (8 May).

The panel was made up of Telecom Italia’s chairman Franco Bernabe and an additional four other board members including a representative of shareholder Telefonica, Julio Linares.

Difficulties in reaching a valuation of Hutchison’s local unit makes a common decision hard to reach. The unit has a so-called fair value of €1.5 billion but faces accumulated losses of up to €8 billion, some of which can used to offset taxes, according to Bloomberg, quoting a person familiar with the matter.

Any combination between the two companies would also face political opposition making its success less than guaranteed.

The panel will also avoid a specific recommendation which might otherwise reveal the opposition of Telefonica to a tie-up with Hutchison, according to Il Messaggero which did not cite its sources.

Telefonica is the largest shareholder in the investment vehicle Telco which owns a 22 per cent stake in Telecom Italia. Telco is the Italian operator’s largest shareholder.