TIM CEO: Brazil Unit Not Up For Sale

Telecom Italia has no intention of selling TIM Participacoes (TSU, TCSL4.BR), its Brazilian unit, TIM Chief Executive Luca Luciani said Wednesday, seeking to quell recent speculation.

"Italy and Brazil are our key markets. Selling this asset is out of the question," he told journalists at an event in Sao Paulo.

Telecom Italia may still sell some international units, while TIM in Brazil has been restructuring since earlier this year, leading to ideas that the Italians were getting it in shape for a sale.

Luciani also said that TIM, Brazil's No. 3 cellphone operator, expects to close the deal to buy local communications infrastructure provider Intelig by the end of the year.

"We have some outstanding legal issues, but this deal should be completed by the end of 2009," he said.

TIM agreed to buy Intelig for approximately $300 million back in April in order to strengthen its high-speed data backbone. However, legal issues arose over the payment of claims in local labor courts.

The executive added that the company plans to accelerate its three-year investment plan, with a budget of 7 billion Brazilian reals, in order to meet sharply rising demand for data services.

-By Alastair Stewart, Dow Jones Newswires; 55-11-2847-4519; brazil@dowjones