(Alliance News) - Telecom Italia Spa closed down 0.6 percent at EUR0.26 on the stock exchange, pending the Court of Appeals decision on the repayment of the concession fee dating back to 1998.

As La Repubblica writes Tuesday, the court had set yesterday as the deadline for an agreement between TIM and the Treasury on more than EUR1 billion compensation but the parties failed to reach an understanding.

If the Appellate ruling is enforceable, TIM would have more negotiating power but a stay pending the Supreme Court would lengthen the time. The sale of Sparkle, on which Treasury and Retelit have submitted a EUR700 million binding offer, is likely to slip due to technical issues related to financing.

Telecom's board meeting scheduled for tomorrow could give a preliminary go-ahead to the deal, but the signing and payment, requested by Treasury in 18 months, remain on hold.

With the royalty case and the sale of Sparkle on standby, TIM may not have the necessary resources by Feb. 12 to honor commitments to shareholders, including a return to the dividend and a buyback of savings bonds, despite EUR250 million already collected from the sale of Inwit Spa's towers.

By Giuseppe Fabio Ciccomascolo, Alliance News senior reporter

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