Italy’s Deputy Communications Minister Paulo Romani has described Telefonica’s indirect stake in Telecom Italia (TI) as a ‘significant problem that must be resolved’ following speculation that the Spanish firm might leave the Telco consortium to take on a direct share in the incumbent, Reuters reports. Telefonica holds a 42.3% share in Telco, which is the largest single investor in TI, with a 24.5% stake. Romani said: ‘Telefonica’s 40% stake in Telco is a significant problem that must be resolved. It is up to the company, but the government is watching carefully.’ As reported by CommsUpdate on 25 September, members of Telco are due to meet in October to discuss the holding group’s future; members could commit to another three years as part of the consortium or opt to leave the group. The potential for Telefonica to exit Telco but retain its shares as a direct stake in TI has refuelled speculation of a possible TI-Telefonica merger, although Romani’s comments indicate the Italian administration’s opposition to any such deal.