Reuters thinks that Telecom Italia investor Vivendi is looking for sources to renew the board
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(Adds TIM comment on CEO search, paragraphs 4-5)
By Agnieszka Flak and Gwénaëlle Barzic
MILAN (Reuters) – Telecom Italia (TIM) chief investor Vivendi (OTC 🙂 is considering changing the board of the Italian telephone group to remove former CEO Luigi Gubitosi, according to four people familiar with the matter.
The battle in the House of Commons comes at a crucial time for TIM, which will meet on Friday to discuss how to respond to KKR’s proposal to take over 33 billion euros ($ 37 billion) from the US KKR fund.
Gubitosi resigned as CEO of TIM last month after investors criticized Vivendi for his actions and had disappointing results.
However, he did not step down as director of the board, and Pietro Labriola, who was appointed general manager and sources said, prevented him from joining the board.
A TIM spokesman reiterated on Thursday that the search for a new CEO was still underway, the group said in a Nov. 26 statement.
Labriola, head of the Brazilian TIM unit, was promoted to general manager, waiting for a vacant seat on the board.
If Gubitosi does not step down as director at Friday’s meeting, he is considering pushing for a renewal of the French Vivendi council, according to two sources.
The two friends said that if Vivendi were to choose this behavior, he would ask for an extraordinary shareholders ’meeting to convene a new board, a move that would need the board’s support.
TIM does not wish to comment.
The renewal of the board could also result in the resignation of a majority of the board members.
Even if another councilor decides to resign and open Labriola’s seat, it is unlikely that Vivendi will be satisfied, as Gubitosi wants him out, two sources said.
However, Vivendi is also considering changing the board, as it wants to draw up an alternative plan for the KKR to relaunch the group, the citizens added.
KKR’s proposal puts a capital loss on Vivendi TIM’s 24% stake. The French media team spent twice as much as € 0.505 on each share offered by KKR to acquire the stake.
Vivendi, which has a 24% stake in TIM and two of its 15 boards, is seeking the support of Italian state-owned CDP investors for plans to renew its board, a source said.
CDP, TIM’s second largest shareholder, declined to comment.
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