Tele­com Italia boss ‘ready to quit’ over ac­tivist

The Sunday Telegraph - Money & Business - - Front page - By Christo­pher Wil­liams

THE chief ex­ec­u­tive of Tele­com Italia has said he will re­sign if ac­tivist hedge fund El­liott pre­vails this week in a power strug­gle with ma­jor share­holder, the French me­dia giant Vivendi.

Amos Gen­ish, a highly re­garded tele­coms vet­eran brought in by Vivendi to shake up Tele­com Italia, told The Sun­day Tele­graph that his po­si­tion would be “un­ten­able” if El­liott suc­ceeded in a finely bal­anced vote on Fri­day.

El­liott has pro­posed a new slate of non-ex­ec­u­tives to re­place those ap­pointed by Vivendi, ar­gu­ing Tele­com Italia is not be­ing run in the best in­ter­ests of in­de­pen­dent share­hold­ers.

The hedge fund has said that it wants Mr Gen­ish to stay on, how­ever, de­spite hav­ing sug­gested changes to his strat­egy in­clud­ing a po­ten­tial sale of its broad­band net­work.

Mr Gen­ish said: “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.”

The com­ments will be viewed as a blow to El­liott as it seeks to per­suade wa­ver­ing in­vestors. While Vivendi’s out­sized in­flu­ence at Tele­com Italia has raised gov­er­nance con­cerns, Mr Gen­ish won the sup­port of 98pc of share­hold­ers in a sep­a­rate vote last week and his exit could trig­ger more in­sta­bil­ity for the com­pany.

Fran­cois Go­dard, an in­dus­try ex­pert at En­ders Anal­y­sis, said: “El­liott’s stand on Gen­ish is a way to re­as­sure other in­vestors, in my view.”

El­liott has mounted an at­tack on Vivendi against a com­plex po­lit­i­cal back­drop. Vivendi is con­trolled by the bil­lion­aire Vin­cent Bol­lore, who was ar­rested in France last week on African cor­rup­tion charges.

Mr Bol­lore is en­gaged in a long bat­tle with Sil­vio Ber­lus­coni, Italy’s for­mer prime min­is­ter, after a me­dia deal be­tween them went sour. Vivendi’s con­trol of Tele­com Italia via a mi­nor­ity stake has drawn anger in Italy, and El­liott has pro­posed a slate of di­rec­tors viewed as Ber­lus­coni busi­ness al­lies.

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