Vivendi CEO Arnaud De Puyfontaine could suspend his executive powers as chairman of Telecom Italia (TIM) to lend his support to a debate on strategy following activist fund Elliott’s move to build a stake in the operator, according to an unnamed Vivendi spokesman cited by Reuters. Elliott last week confirmed it had taken an as yet unspecified stake in TIM and planned to request the resignation of at least 5 and up to 7 board members, including de Puyfontaine and CEO Amos Genish, in a bid to counter the operator’s largest investor Vivendi and improve strategy, value and governance.
“During the period devoted to this strategic debate, Arnaud de Puyfontaine has indicated that he is considering suspending his executive functions at TIM,” said the Vivendi spokesman, adding that “like any other shareholder sensitive to leveraging its investments, Vivendi would be ready, if necessary, to support another strategy capable of generating a short term rise in the TIM share price."
The report said Vivendi has invested close to EUR 4 billion in TIM since first becoming a shareholder in mid-2015 and now controls two-thirds of its board via a 24 percent stake. However, the Italian government last year decided to activate the “golden power” rule of 2012 to ensure it had a say in some strategic decisions at TIM.
Elliot should soon reveal its stake in TIM, with the investor already having exercised its right to request the resignation of 6 board members, including its chairman and chief executive, reported business daily Il Sole 24 Ore, adding that CEO Amos Genish is attempting to build up support to avoid having to step down.
