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UPDATE 2-Telecom Italia investors in talks over group's revamp, PM says

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* PM vows to protect job, network, technology

* TIM received $37 bln takeover approach by KKR

* Trader says PM's words fuel takeover speculation

* TIM not expected to name new CEO before January (Adds details)

ROME, Dec 22 (Reuters) - The main investors in Telecom Italia (TIM) including the Treasury-owned CDP are discussing a revamp of the ailing former phone monopoly, Italy's prime minister said, pledging to protect jobs and infrastructure assets at the group.

Debt-laden TIM has been hit by a string of profit warnings which led to the ousting of Chief Executive Luigi Gubitosi https://www.reuters.com/business/media-telecom/telecom-italia-reaches-draft-accord-former-ceo-gubitosi-leave-board-sources-2021-12-17, a week after a takeover approach by U.S. fund KKR valuing TIM at 33 billion euros ($37 bln) including debt.

Prime Minister Mario Draghi told reporters at an end of year news conference it was not clear what was happening with TIM and the government had yet to take a stance.

"The situation is evolving, there is a takeover bid that has to be announced but whose features are unclear, there are negotiations among (state investor) CDP, Vivendi and other TIM shareholders," Draghi said.

"The government is not in a position to say: I want this or that. There is no pre-determined path," he added.

Vivendi, the French media group led by financier Vincent Bollore, is the main shareholder in TIM with a near 24% stake, followed by CDP with 10%.

Shares in TIM rose as much as 3% following Draghi's comments, with a Milan-based trader saying they were seen as "a sort of green light" to a takeover of TIM amid speculation about a potential improved bid.

At 0.44 euros apiece, TIM shares trade below the 0.505 euros per share terms offered by KKR.

After saying such a price did not adequately value TIM, Vivendi has for the first time opened up to the possibility of handing control of TIM's fixed network to the state as part of a project led by Italian institutions.

STATE OVERSIGHT

The government had hailed KKR's interest as "positive news" for Italy but a leadership vacuum at TIM has delayed the group's response.

Also KKR's project envisages the carve-out of TIM's network to be placed under state oversight through CDP, sources have said.

TIM's network, Italy's biggest telecoms infrastructure, is deemed strategic by the government, which has special powers to block unwanted interest. KKR has made its offer conditional on backing from the government and TIM's board.

"The government wants to protect three things in a corporate overhaul of TIM: jobs, its infrastructure, meaning the group's fixed-line network, and ... its first-rate technology," the prime minister said.

"The corporate structure we will get to, through decisions taken either by TIM shareholders or also the government, will need to meet those three goals," Draghi said.

KKR already owns 37.5% of TIM's "last-mile" grid after a 1.8 billion euro investment last year.

TIM has not given KKR access to its books, as requested by the fund before proceeding with a formal bid, and a special committee set up to assess the offer is still evaluating it.

Following Gubitosi's resignation, TIM has promoted senior executive Pietro Labriola to general manager.

Labriola is a leading candidate for the role of CEO, but TIM is not expected to appoint a new chief before January and the search process is ongoing, two people close to the matter said.

($1 = 0.8848 euros) (Reporting by Gavin Jones, Giuseppe Fonte, Giselda Vagnoni and Elvira Pollina; Writing by Valentina Za; Editing by Edmund Blair and David Holmes)

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