Telecom Italia CEO is Ousted as Elliott Lands Another Blow in Vivendi Tussle -- 2nd Update
14 November 2018 - 1:42AM
Dow Jones News
(Adds detail, quotes, share price)
By Donato Paolo Mancini
Telecom Italia's (TIT.MI) board has ousted Chief Executive Amos
Genish with immediate effect, the company said Tuesday, the
culmination of a monthslong tussle between its two main
shareholders, Vivendi SA (VIV.FR) and Elliott Management Corp.
Mr. Genish was the second chief executive to guide the company
in little more than a year. Last summer, Flavio Cattaneo resigned
after relations with Vivendi soured, having held the top position
for about a year.
The president of the board, Fulvio Conti, will take over in the
interim and a board meeting has been called for Sunday to choose a
new CEO, Telecom Italia said.
Vivendi and Elliott have been at odds for months regarding
Telecom Italia, with Elliott pushing for strategic changes at the
company. In spring, Elliott took control of the board. Mr. Genish,
who was appointed by Vivendi, appeared until recently to have
Elliott's support.
"Mr. Genish was supposed to be OK both for Vivendi and Elliott,"
Alexandre Iatrides of financial-services group ODDO BHF said. "I
think we're watching another event of war between the two and, in
that sense, Mr. Genish is the fuse [for this event]."
Telecom Italia's woes have been more operational and structural
rather management-related, Mr. Iatrides said. Elliott had been
pushing for a network split, and Vivendi wasn't against it, he
said. But the plan suffered many setbacks and has been canceled and
restarted several times, also owing to Telecom Italia's high debt
load.
Separately, Telecom Italia on Tuesday defended itself against
recent comments by Vivendi, which last week criticized the Italian
company's 2 billion euro ($.2.28 billion) writedown in the third
quarter.
"The need to proceed with these writedowns is not attributable
to disorganization on the part of the company or to failures in the
new governance, as Vivendi insinuated, but to measures implemented
by Amos Genish [appointed by shareholder Vivendi] that can be drawn
back to strategic choices made by shareholder Vivendi," Telecom
Italia said.
The company called on Vivendi and others to "cease making
further false and misleading announcements," which it said damaged
shareholders.
Telecom Italia's share price has shed about 25% of its value
year-to-date, and more than 50% in the past three years. At 1403
GMT, the share traded at EUR0.53, up 0.3%
Activist fund Elliott has been waging corporate battles around
the world which have affected companies spanning sectors from
manufacturing to asset management.
Write to Donato Paolo Mancini at
donatopaolo.mancini@dowjones.com; @donatopmancini
(END) Dow Jones Newswires
November 13, 2018 09:27 ET (14:27 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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