Pirelli Chairman: Co Has No Plan To Spin Off Telecom Unit

MILAN (MF-Dow Jones)--Pirelli has no plan at present to spin off Pirelli's telecommunications business from the rest of the company, Chairman Marco Tronchetti Provera told shareholders Monday.

"There's no plan to split the company at present," Tronchetti Provera said during the group's annual shareholder meeting, adding that any operation at Pirelli would be pursued in the interest of all shareholders.

According to recent reports in the Italian press there is support from a consortium of Italian banks for the tires-to-telecoms group split into two holdings, one controlling Telecom Italia's largest shareholder Olimpia and the other controlling its other businesses, which range from tires to real estate.

The plan could lead to a spin-off of Pirelli's stake in holding company Olimpia - which controls 18% of Telecom Italia - into a new company.

Pirelli has been trying for months to sell its majority stake in Olimpia, but several approaches by foreign suitors have stumbled in the last eight months amid political opposition.

Tronchetti Provera reiterated Monday his company is mulling various options for the sale of part or all of its 80% stake in Olimpia, although he said he will only go ahead with a sale at the right price.

Pirelli expects an agreement for the sale of its controlling interest in Telecom Italia in the coming months, said Provera, stressing that Pirelli is not in a hurry to sell its holding in Olimpia.

-By Rosario Murgida, with MF-Dow Jones, and Giada Zampano, Dow Jones Newswires; +39 06 6782543; giada.zampano@dowjones.com

(END) Dow Jones Newswires "

Posted to the site on 23rd April 2007