Telecom Italia's (TIM) board of directors has approved an offer from Italy's Ministry of Economy and Finance (MEF) and Retelit, a company controlled by the Asterion fund, for its Sparkle unit.

The carriers met this week to examine the offer, which values Sparkle at €700 million ($728m).

In an announcement this week, TIM's board voted "unanimously" to approve the bid.

A sale is expected to be finalized by the first quarter of next year, while the signing to announce the deal will take place on April 11, 2025.

TIM said its examination of the transaction was carried out with the assistance of Vitale & Co, Goldman Sachs, and Mediobanca, plus legal advisors Gatti Pavesi Bianchi Ludovici.

The Italian carrier announced in December that it had received the non-binding offer from the MEF and Retelit.

The government had a previously undisclosed offer for the unit rejected in February. TIM reportedly wanted up to €750 million ($782m) at the time.

Sparkle operates more than 600,000km of cables that connect countries across Europe and the Americas. Italy is seeking to bring this network under state ownership as part of a plan from Giorgia Meloni’s government to take control of more strategic assets.

TIM has been selling off various parts of its business in recent months. In January, the Italian government approved TIM's planned sale of its fixed line network to KKR, worth €22 billion ($22.94bn). The operator agreed to sell its landline grid network to KKR last November.