By Andrés González
SANTANDER Spain (Reuters) - Telefonica (MC:TEF) plans to exit Telecom Italia (MI:TLIT) once the Spanish group has finalised the purchase of Vivendi's (PA:VIV) Brazilian broadband unit GVT, its chairman said on Monday, ending a long-standing shareholding.
Tense relations between the Spanish and Italian firms came to a head last week when Telefonica beat Telecom Italia to buy GVT, a blow to the latter which could turn it into a takeover target in a fast-consolidating industry.
"After the GVT operation the message is clear, we don't want to stay in Telecom Italia," Telefonica Chairman Cesar Alierta told journalists after attending a telecoms conference in Santander, northern Spain.
Telecom Italia declined to comment.
Telefonica has taken steps in recent months to sell down its stake in Telecom Italia, which it owns through holding company Telco. It will hold 8.3 percent of voting rights in the firm once it converts a three-year bond exchangeable into Telecom Italia shares.
It offered Vivendi those remaining rights as part of its cash and share bid for GVT last week, worth 7.45 billion euros (5.9 billion pounds), signalling it was ready to cut ties with Telecom Italia.
Italy's Intesa Sanpaolo (MI:ISP), Mediobanca (MI:MDBI) and Generali (MI:GASI) formed holding company Telco in 2007 with Telefonica, aiming to fend off a takeover bid for Telecom Italia by U.S. group AT&T (N:T) and Mexican tycoon Carlos Slim.
Vivendi is likely to accept to take from Telefonica some 5.7 percent of Telecom Italia shares, or 8.3 percent of voting rights, sources have told Reuters. Analysts have speculated Vivendi could later buy out the Italian investors too.
When Telco was formed, Telecom Italia shares traded as high as 2.475 euros, three times the current value, before the debt-laden Italian company was hit by Italy's prolonged recession.
Alierta also said on Monday that Telefonica could use treasury stock to partially finance the GVT acquisition if market conditions make a planned capital hike difficult.
(Additional reporting by Danilo Masoni in Milan and Robert Hetz in Madrid; Writing by Tracy Rucinski and Sarah White; Editing by Mark Potter)