By Elvira Pollina

MILAN (Reuters), -Telecom Italia is closer to appointing a chief executive. General Manager Pietro Laborriola was tipped by four people familiar with the matter on Tuesday.

TIM is currently facing a takeover offer from KKR in the US for 10.8 billion euros ($12.24 trillion). This comes after Luigi Gubitosi resigned following a series of profit warnings.

Salvatore Rossi is the Chairman of TIM. He called a meeting for the board on January 21st to appoint a replacement CEO. A group of directors included representatives from Vivendi (OTC):, and asked Rossi to accelerate the process.

Labriola is a former TIM CEO and currently the CEO of TIM’s Brazilian operations. He has just completed a three-year plan for the business to relaunch the group.

Due to the fierce competition for its local market, TIM’s debt-laden status has been in danger since years. The company’s tight finances make it difficult to invest in its network upgrade, which is required by the digital plan of Italy.

Sources previously stated that the business plan could include a spin-off of assets such as TIM’s valuable fixed network infrastructure.

Labriola has the support of Vivendi and will present a plan outline to the directors in January 18. Labriola, who has the backing of Vivendi, will present a plan to directors on January 18.

Labriola’s plan which will be a standard to measure TIM’s value is a critical element of TIM’s response on KKR’s proposed proposal. Its backing is conditional upon TIM’s board’s approval and Italy’s government’s support.

Vivendi stated that KKR’s offer doesn’t adequately value TIM.

Mediobanca (OTC:) and Vitale&Co are working with TIM on the business plan. TIM is being assisted by LionTree and Goldman Sachs (NYSE :).

CDP has renewed a call to TIM for a merger of its network and that of Open Fiber. Open Fiber owns 60% of CDP’s network. The project was previously stalled by the current government.

Vivendi indicated that it would be open to giving control of TIM’s network fixed to the Italian government as part of a project managed by Italian institutions. This is a signal it might be willing to pursue an alternative plan than KKR’s.

KKR’s proposal includes the seperation of TIM network assets, whose management would be entrusted by CDP.

($1 = 0.8824 euros)