By Elvira Pollina

MILAN, (Reuters) – The board Telecom Italia (MI.) (TIM), Monday will see the discussion on group restructuring as Pietro Labriola, newly appointed chief executive, tries to create an alternative proposal to a U.S. funds KKR takeover.

It was late November when the largest Italian telecom operator approached the private equity company. The process then stalled as Telecom Italia’s CEO changed. Italy had to re-elect its president.

Labriola was previously the head of TIM’s Brazilian operations. Labriola is currently working on a separate plan to respond to the 10.8 million euro ($12.30 trillion) offer from KKR. Vivendi, TIM’s largest shareholder, has stated that it was too low.

TIM, a debt-laden company that has been under pressure from domestic competition for many years and following a series of profit warnings in the last year is looking at splitting up its network assets to form a separate entity as part of a larger revamp of its business.

The merger could lead to the long-awaited merging of TIM’s infrastructure assets, with Open Fiber’s, a move supported by CDP (the second biggest investor) and TIM.

Italy’s largest telecom unions called Friday for a general strike and protest on February 23, along with further actions in protest of the possible spinoff, raising concern about potential job loss.

The future of TIM is political sensitive as the Italian government plans to make use of funds from the European Union to increase broadband access for millions more households and businesses in its recovery after pandemic.

Two people familiar with the situation told Reuters that while KKR waits for KKR to formalize its bid, Italy’s Treasury would allow the fund to participate in the overhaul of the telecom. KKR invested 1.8billion euros last year in a 37.5% share in TIM’s secondary network.

MARCH MOVES

Labriola’s plan that the board will approve March 2nd by unanimous consent, TIM would concentrate on its consumer business while enhancing services for corporate clients as well as developing cloud, Internet of things, and cybersecurity businesses.

Sources previously stated that TIM wouldn’t take a firm stance on KKR proposals before March.

Europe’s telecom operators are trying to find ways of boosting their businesses. In fact, bankers have reported talks with several countries about how they can help companies prepare for expensive 5G service rollouts.

Vodafone, Britain (NASDAQ:), said Thursday that it rejected an initial approach from France’s Iliad & Apax Partners for its Italian business. The combination would have put TIM in jeopardy as Italy’s biggest mobile phone operator.

($1 = 0.8782 euros)