UPDATE: Valentino Rossi-backed Moto3 team now confirmed as having filed an entry for the 2014 World Championship.

Valentino Rossi is to start a Moto3 team, running Romano Fenati and possibly half-brother Luca Marini on KTM machinery in 2014.

Rumours that Rossi would become involved in a Moto3 team have been circling for months.

But in August the seven time MotoGP champion insisted the plan was just to start a 'VR46 Riders Academy', to help support young Italian racers, rather than an actual team.

However Italy's SportMediaset reports that the Italian Federation will no longer field the San Carlo-backed Team Italia squad next year, leaving 2012 race winner Fenati in need of a team.

Italy's Sky TV will sponsor the new VR46 project, while KTM machines are also confirmed - and an obvious choice, having won every Moto3 grand prix so far this year.

"We have joined forces with Sky in order to give the Italian riders the opportunity to be competitive and reach the highest levels," said Rossi.

The identity of Fenati's team-mate is not yet known, but Rossi's half-brother Marini is unsurprisingly being tipped as a possibility. Marini - currently second in the Italian Moto3 championship - made his grand prix debut as a wild-card last time at Misano, but fell at the first turn.

Teams wishing to enter next year's Moto2 or Moto3 World Championships submitted their requests at the San Marino Grand Prix. Further details on the 2014 entries will be made available after the next selection meeting at the Malaysian Grand Prix, in October.

However the official MotoGP website has confirmed that the new VR46/Sky team "has already forwarded an official entry application to MotoGP governing body the FIM and commercial rights holder Dorna Sports in order to participate in the Moto3 class."