UPDATE 3-TIM investor Merlyn wants sale of Brazilian unit, retail
(Adds source on origin of Merlyn plan in paragraphs 3-4)
By Elvira Pollina
MILAN, March 20 (Reuters) - Telecom Italia shareholder Merlyn Partners said on Wednesday the debt-laden company should sell its Brazilian unit this year as part of a radical restructuring.
The Luxembourg-based alternative investment fund, which held 0.53% of Telecom Italia (TIM) as of Tuesday, also suggested in a statement that Italy's former phone monopoly should sell off its consumer business with a target to close that deal in 2025.
The proposal put forward by Merlyn Partners was drafted by former TIM deputy general manager Stefano Siragusa, who is seeking to get other TIM investors to support the strategy and back his appointment for the role of CEO, according to a source with knowledge of the matter.
Siragusa left TIM in the summer of 2022 after having clashed over its direction with current CEO Pietro Labriola, who is seeking a new term as boss at a shareholder meeting next month.
There was no immediate response from TIM to Merlyn's proposals.
Having previously challenged the disposal, Merlyn now said that TIM should seek to conclude the sale of its landline grid to KKR in a 22 billion euro ($23.9 billion) deal "as soon as possible" and hopefully by this summer.
The sale of the network grid is the centre-piece of Labriola's efforts to reshape the debt-laden group, but TIM shares plunged this month when he set out financial targets for the new TIM.
The network sale has been opposed by French media group Vivendi which is TIM's largest shareholder and questions the viability of the residual business.
Merlyn's break-up plans are more ambitious than those of Labriola and would leave only what it called "TechCo", a tech and infrastructure company serving business and public administration.
Merlyn also indicated it wanted to see fresh faces in the boardroom. "We have a list of candidates to join the board with international and sector expertise," it said.
($1 = 0.9224 euros) (Reporting by Elvira Pollina; writing by Gianluca Semeraro and Keith Weir; editing by Mark Potter)
