Telecom Italia looking at network valuation of at least 25 bln euros-sources

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MILAN, July 5 (Reuters) - Telecom Italia (TIM) is looking to fetch a valuation of at least 25 billion euros ($26 billion) including debt for its grid under a plan to separate its fixed-line assets from its services arm, two sources close to the matter said.

The price tag is closer to the 31 billion euro figure sought by TIM's top shareholder Vivendi in any potential network deal than initial estimates provided by two sources in line with analysts estimates.

In May sources had told Reuters TIM has started looking at a valuation of around 20 billion euros, including debt and before any synergies, in a potential network deal.

The former phone monopoly could sell its domestic fixed access network and its submarine cable unit Sparkle as part of a government-sponsored project to create a unified broadband company with state backed rival Open Fiber.

Valuation is a key issue in ongoing talks with state lender CDP to combine TIM's network with Open Fiber, which is majority owned by CDP.

CDP is also the second largest investor in TIM.

TIM's board will meet on Wednesday to discuss a business plan centred on the split of its fixed network assets from its service businesses. ($1 = 0.9707 euros) (Reporting by Elvira Pollina; Editing Valentina Za, Alexandra Hudson)

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