• Vimpelcom, CK Hutchison seeking to sell towers, spectrum
  • Fastweb, Tiscali also in talks with owners of Wind, 3 Italia

VimpelCom Ltd. and CK Hutchison Holdings Ltd., seeking to address antitrust objections to the planned merger of their Italian mobile-phone units, are in talks with Sky Plc, Iliad SA and other suitors to sell assets that would be used to create a new wireless network in the country, according to people familiar with the matter.

The talks are fluid and it’s too soon to tell who will ultimately join forces, said the people, who asked not to be named because the negotiations are private. Swisscom AG’s Italian unit, Fastweb SpA, and Tiscali SpA, the Italian internet service provider, are also having discussions with VimpelCom’s Wind Telecomunicazioni SpA and Hutchison’s 3 Italia, people said.

Wind and 3 Italia have reached out to potential buyers, offering to sell redundant frequencies and about 5,000 wireless towers to win over European Union antitrust regulators, said the people. The EU, which blocked a U.K. deal involving Hutchison this month, is said to be preparing formal objections to the 21.8 billion-euro ($24.5 billion) Italian deal, which would create the country’s largest wireless provider by customers.

Representatives for Iliad, Sky, VimpelCom, Fastweb and Tiscali declined to comment. The discussions with Sky and Iliad were reported last week by Il Sole 24 Ore.

Scrutiny from EU Competition Commissioner Margrethe Vestager has forced European telecom operators to reassess their plans to consolidate. Adding a new carrier would leave Italy with four mobile operators after 3 Italia and Wind merge, while the failed U.K. deal -- like the Italian one as currently proposed -- would have reduced the number of players in the market to three.

In March, the EU opened an in-depth probe into the Italy pact, citing concerns about potential price increases and reduced customer choice, similar reasons cited in blocking the U.K. deal.

Rupert Murdoch’s Sky, which would have gained access to more spectrum for its virtual mobile service in the failed U.K. deal, could back Iliad or other bidders to get network access in Italy, said one of the people. It is also discussing backing potential private-equity bidders for Telefonica SA’s O2 with the same goal of gaining access to spectrum, the person said.

Iliad Founder Xavier Niel owns a derivative stake in Telecom Italia, which would compete against the new Italian wireless company, though he doesn’t have voting rights. It’s not clear whether Niel or Iliad would invest in the new Italian carrier, the people said.

Tiscali has Russian Otkritie Disciplined Equity Fund SPC as its largest investor.

Hutchison’s Italian deal would unseat Telecom Italia as the biggest mobile phone carrier, creating a wireless player with more than 31 million customers and 6.4 billion euros in 2014 sales. The companies are targeting annual savings of 700 million euros as they try to create a stronger and more efficient rival to Telecom Italia and Vodafone Group Plc’s local unit.

EU regulators are expected to issue the document of objections in June, people familiar with the matter said last month.

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