Italy 's government on Thursday approved plans to sell up to 12 billion euros ($16.13 billion) in business assets in a bid to overcome objections from Brussels and gain the right to make extra public investments in 2014.  

The Treasury will sell a 3% stake in oil giant Eni SpA (E) as well as larger stakes in unlisted companies, including shipbuilder Fincantieri SpA, Prime Minister Enrico Letta said after a cabinet meeting.

The Eni stake, which alone should raise EUR2 billion, will be part of a complex buyback operation that will keep the Italian state's controlling grip on the company at around 30%, he said.

Also on the block is SACE, a bank offering trade credits to explorers, as such export-import banks tend to be mostly privately owned abroad, Mr. Letta said.

Other planned sales are a stake in CDP Reti, a holding company owned by Cassa Depositi e Prestiti that has large holdings in companies such as power grid operator Terna SpA (TRN.MI), the premier added.

The proceeds will allow Italy to lower its public debt ratio in 2014, thus unblocking a problem that had led the European Commission to rule against Italy's use of the European Union's so-called "investment clause," which allows governments to calculate some productive investments outside of the annual budget parameters.

That should free up at least EUR3 billion in funds next year.

Economy Minister Fabrizio Saccomanni signaled he was fairly certain the new plan would win the EU's approval. He will present the plan to officials at the Eurogroup meeting in Brussels on Friday.

Mr. Letta also said the cabinet was poised to cancel an unpopular tax on primary residences, fulfilling one of the core pledges his coalition government has made. That will require EUR2.4 billion in offsetting revenue to keep this year's budget on track.

The government will formalize that next Tuesday, as well as outlining its decision to allow banks to revalue upwards their shares in the Bank of Italy, whose book value dates back to 1936.
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