MILAN (Reuters) – Telecom Italia (TIM) CEO Amos Genish stated his position at Italy’s largest cellphone group can be “untenable” if activist fund Elliott manages to win the majority of board seats at a shareholder vote on Friday, in response to a newspaper interview.
Elliott has constructed a stake of 9 % within the former state cellphone monopoly to attempt to shake up the best way high shareholder Vivendi – which owns 24 % – runs it.
The two buyers have been buying and selling blows for the previous eight weeks, with Elliott accusing Vivendi of serving solely its personal pursuits and the French media group saying the fund was trying just for short-term monetary features.
“The issue for me isn’t about which side I’m on,” Genish, who was introduced in final yr by Vivendi, advised The Sunday Telegraph.
“I am the CEO of Telecom Italia and I am on Telecom Italia’s side. The question is whether or not I have shareholders and a board who stand behind the business plan.”
Elliott couldn’t instantly be reached for remark.
On May four, TIM shareholders will meet to elect a complete new board after the majority of administrators resigned final month, triggering a full reshuffle. They should choose between Elliott’s slate of 10 unbiased Italian enterprise heavyweights and Vivendi’s checklist, which did little to allay governance issues, however options Genish.
This may show a conundrum for some buyers who might wish to weaken Vivendi’s grip however won’t wish to lose the CEO, who offered his Three-year marketing strategy final month.
At a separate vote final Tuesday, almost 98 % of shareholders current at a common assembly backed the brand new CEO who’s properly revered for his monitor report within the telecoms trade and as a dealmaker in Brazil.
“I can’t see how a CEO could implement a plan he doesn’t believe in,” Genish stated.
Elliott has repeatedly stated it absolutely supported Genish and needs him to remain on after the board renewal, though a number of proposals made by the activist investor conflict with that of the present administration.
TIM’s administration has defended its personal technique, saying various strikes proposed by Elliott have been untimely, unfeasible and carried monetary and execution dangers.
Should Elliott win the majority, Vivendi may nonetheless appoint 5 board members one among whom can be Genish. However, the Israeli-born government might select to not keep on.
“If the Vivendi slate does not get the majority of votes, because this is clearly the only slate to support our long-term industrial plan, I firmly believe my position as CEO would be untenable,” Genish advised the paper.
New York-headquartered Elliott Management Corp was based by U.S. billionaire Paul Singer and manages two funds with mixed property below administration of about $35 billion. Its push for change at Telecom Italia is being spearheaded by London-based affiliate Elliott Advisors (UK).
Reporting by Agnieszka Flak; Editing by Elaine Hardcastle