MILAN (Reuters) - The board of Italian broadcaster Mediaset <MS.MI> has given management a mandate to press ahead with legal action against Vivendi <VIV.PA> over a disputed pay-TV deal, a source close to the matter said on Tuesday.

The decision was taken after the French media giant did not come up with an alternative proposal to resolve the situation, the source said.

Mediaset, owned by former Prime Minister Silvio Berlusconi, is suing Vivendi for damages after it backed away from an April deal to take full control of the Italian group's pay-TV unit Premium.

"The board has given managers a mandate to proceed, if opportune, with new actions to speed up execution of the contract," the source said.

(Reporting by Giancarlo Navach, writing by Stephen Jewkes)