By Elvira Pollina and Akriti Sharma

MILAN (Reuters) -U.S. fund KKR strengthened its lead within the race to safe the landline grid of Telecom Italia (BIT:) (TIM) when it supplied to lift its bid by as much as or over 2 billion euros ($2.2 billion), two folks with data of the matter stated.

The worth of KKR’s provide may high 23 billion euros total, widening the hole with a rival proposal by a consortium comprising Italian state lender CDP and Australian fund Macquarie.

The improved provide would nonetheless be in need of a valuation of greater than 30 billion euros for the grid sought by TIM’s high shareholder Vivendi (OTC:). However it stays TIM CEO Pietro Labriola’s best choice to drag off plans to rescue the debt-laden agency through a sale of the community.

Sources had beforehand instructed Reuters that each Labriola and a few main Italian officers already noticed KKR because the strongest bidder previous to Friday’s proposal.

TIM stated late on Friday it had acquired two new provides for its grid, with out offering particulars. It had sought improved provides for its most beneficial asset after having assessed as not but satisfactory the proposals acquired in Might.

Labriola plans to focus TIM’s efforts on its ServCo providers enterprise and promote its NetCo unit comprising the home fixed-access community and worldwide submarine cable unit Sparkle to chop debt.

The general worth of KKR’s bid hinges on the phrases of the contracts linking ServCo to NetCo, the sources stated, including that the fund had requested for 4 weeks to hold out due diligence to debate such circumstances.

KKR declined to remark.

The supply stated KKR was additionally providing to go away TIM a stake in NetCo, having beforehand indicated it will additionally welcome a state entity as a shareholder within the grid, which is Italy’s important telecoms infrastructure.

CDP and Macquarie have stored the financial worth of their proposal little modified, suggesting numerous measures to handle antitrust points, one other two folks near the matter stated.

The antitrust issues are linked to the truth that CDP and Macquarie additionally personal fibre-optic wholesale supplier Open Fiber. One treatment may contain elements of Open Fiber being bought off.

CDP can also be TIM’s second-largest shareholder with a ten% stake.

TIM’s board meets to overview the proposals on June 19 and is anticipated to take a call on June 22.

($1 = 0.9305 euros)