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Italy working on legislative proposal to create single network company - sources

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MILAN (Reuters) - Italy is working on a legislative proposal to create a single broadband network company, two sources familiar with the matter said on Sunday, in a move that would put pressure on Telecom Italia <TLIT.MI> and Open Fiber to merge their infrastructures.

Open Fiber, owned by state-controlled utility Enel <ENEI.MI> and state lender CDP, has been rolling out a fibre optic network across Italy, in direct competition with Italy's biggest phone group Telecom Italia (TIM). Industry experts have warned such duplication of infrastructure makes little economic sense.

"It is not that far from reality," one of the sources said when asked about a planned law amendment aimed at facilitating the combination of the two networks, adding the government was trying to do it "as soon as possible".

The anti-establishment 5-Star Movement, part of Italy's ruling coalition with the right-wing League, has previously said it was in favour of a single network operator under public control.

News of the law amendment was first reported by Italian dailies Corriere della Sera and Il Sole 24 Ore.

(Reporting by Stephen Jewkes, writing by Agnieszka Flak, editing by Giulia Segreti)

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