(Bloomberg) -- The Italian government is preparing to ask the European Union for an extension on the year-end deadline to dispose of its stake in Banca Monte dei Paschi di Siena SpA.

The Treasury is preparing the request after talks on a sale of Monte Paschi to UniCredit officially collapsed on Sunday, according to people with knowledge of the matter, who asked not to be identified as the plans are private.  

The EU imposed the deadline for Italy to dispose of its stake by the end of this year after it was rescued by Italy following a scandal over its finances.

A treasury spokesman declined to comment.

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