Telecom Italia to axe 4,000 jobs; sell euro 3 bn assets

Telecom Italia will slash more 4,000 jobs and sell assets worth euro 3 billion following its restructuring and growth plan, which aims to reduce company's debt significantly in the next three years.

The Italian telecom firm would reduce the domestic employee numbers by 4,000 in addition to the earlier planned 5,000 job cuts by 2010, it said in a statement.

Telecom Italia is targeting to reduce the debt significantly over the period 2009-2011. It plans to reduce net debt to earnings before by interest, tax and depreciation and amortisation (EBITDA) ratio to 2.3 at the end of 2011 from over 3 at present.

At the end of 2009, the net debt/EBITDA ratio is expected to be around 2.9 by year-end 2009.

"The conditions that have since emerged on the market and in the real economy mean that it is necessary to be even more incisive in our priority of debt reduction," Telecom Italia CEO Franco Bernab said.

Further, the company plans to consolidate its equity stake in Telecom Argentina with the support of local partner, and no financial outlay would be from Telecom Italia.

Telecom Italia would also sell of its non-core assets for up to euro 3 billion, while it will strengthen its position in emerging market of Brazil.

The restructuring plan entails reduction of costs and investments by some euro 2 billion in 2011, the statement added.