UPDATE 1-Australia's Telstra announces 8,000 job cuts, to make infrastructure unit a separate entity

unit a separate entity@ (Adds job cuts, CEO comment)

June 20 (Reuters) - Australia's biggest telecommunications company Telstra Corp Ltd on Wednesday said it would lay off 8,000 employees, including removing 25 percent of executive and middle management roles, as well as spinning off its infrastructure assets into a standalone unit.

The new unit, to be named, Telstra InfraCo will comprise Telstras fixed network infrastructure and data centers along with operations of Telstra's National Broadband Network.

The new Business Unit is expected to control assets with a book value of about A$11 billion ($8.11 billion).

"We are now at a tipping point where we must act more boldly if we are to continue to be the nations leading telecommunications company," Chief Executive Andrew Penn said regarding the layoffs.

Telstra said it would increase its productivity program by a further A$1 billion in order to reduce costs by A$2.5 billion (US$1.84 billion) by fiscal 2022.

Telstra also said it expects fiscal 2019 core earnings between A$8.7 billion and A$9.4 billion, excluding restructuring costs of approximately A$600 million.

Telstra has seen rising competition squeeze its mobile phone margins and fixed-line revenue dwindle, leading to a narrowing of its earnings forecast for the current financial year as of May and a warning that challenging conditions were expected to extend into 2019. ($1 = 1.3559 Australian dollars) ($1 = 1.3561 Australian dollars) (Reporting by Susan Mathew and Aditya Soni in Bengaluru,)