Telecom Italia (TIM) directors want an improved offer of up to €750 million ($807m) from the Italian Treasury for the telcos submarine cable unit Sparkle.
As reported by Reuters, directors at TIM have deemed the initial offer as too low.
Instead, TIM is expected to negotiate for better financial terms.
The Italian Treasury confirmed last week it had submitted an undisclosed bid for Sparkle.
A board meeting had been scheduled to take place today to discuss the offer, TIM noted last week.
Sparkle's subsea cables link countries including Israel and the US, with the unit owning and managing a network of more than 600,000 kilometers (373,000 miles) of both terrestrial and sub-sea fiber.
These cables span Europe, the Mediterranean, and the Americas.
The government's bid for Sparkle has been expected, following reports last year that it wished to control the unit.
Last month, the Italian government approved TIM's planned sale of its fixed line network to KKR, worth €22 billion ($23.92bn).
TIM agreed to sell its landline grid network to US investment firm KKR in November.
