LONDON (Reuters) – British group Vodafone said on Monday it was in “active discussions” about a deal in Italy, after the company rejected Iliad’s proposal at the end of January to merge their activities in the country, preferring to continue other options.

According to sources, Vodafone, which recently announced two major operations, one in Spain where it will sell its local subsidiary for five billion euros and the other in the United Kingdom, where it will merge its mobile activities with those of CK Hutchison, is considering an agreement with Fastweb, the Italian unit of Swisscom.

Vodafone reported on Monday a growth of 4.7% in its turnover in the third quarter, identical to that of the previous quarter, with a less significant drop in Spain which helped to compensate for a slowdown in growth in Germany , its most important market, where growth fell from 1.1% to 0.3%.

In Italy, the group’s worst-performing market, services revenue fell 1.3% during the third quarter, compared to a 1% decline in the previous quarter.

On the London Stock Exchange, Vodafone shares fell 1.2% in the morning.

Chief executive Margherita Della Valle said Vodafone maintained “good” momentum in services revenue during the quarter in Europe and Africa, supported by demand from business customers.

“The announced transactions in the UK and Spain are progressing well, and we are in active discussions in Italy,” she added.

For Citi analysts, the results are generally in line with expectations “even if the slowdown in Germany may be a source of concern.”

Vodafone has reiterated its full-year guidance and expects adjusted earnings before interest, tax, depreciation and amortization of around €13.3 billion with adjusted free cash flow of around €3.3 billion. Billions of Euro’s.

Analysts, however, remain skeptical and on average forecast a profit of 13.07 billion euros and a cash flow of 3.13 billion euros, according to a consensus established by the company.

(Reporting Paul Sandle; Lina Golovnya, edited by Blandine Hénault)

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