TI.A Telecom Italia S.P.A. New

By Patrick Costello

Telecom Italia SpA (TIT.MI) shares rose slightly Monday after the company named Luigi Gubitosi as its new chief executive officer Sunday to replace recently-ousted CEO Amos Genish.

Mr. Gubitosi joined Telecom Italia as an independent board member in May 2018. He was appointed an extraordinary commissioner of Alitalia SpA in May 2017 and previously served as CEO of Italy's Wind Telecomunicazioni SpA and general manager of Italian state broadcaster RAI Radiotelevisione Italiana.

Mr. Genish was dismissed from his position as CEO on Nov. 13 as part of the ongoing struggle between Telecom Italia shareholders Elliot Management Corp. and Vivendi SA (VIV.FR).

The activist investor Elliot has pushed for a management and strategy overhaul at Telecom Italia since acquiring a stake in the company earlier this year, putting it at odds with Telecom Italia's largest shareholder Vivendi. Mr. Gubitosi is backed by Elliot, which wrested control of Telecom Italia's board away from Vivendi in May through the appointment of numerous board members.

Shares of the Italian telecoms firm were up 3.6% to 0.55 euros ($0.63) at 1102 GMT. Telecom Italia shares are down 24% year-to-date.

Bryan Garnier said Mr. Gubitosi's profile appeared to be well-suited for the position, adding his industry experience, connections to Italian authorities and banking background might reassure investors.

Still, "turmoil and uncertainty" should be expected going forward, as the new CEO will need full board support for capital restructuring and turnaround operations, the bank said.

Jefferies likewise warned that value creation is "not guaranteed" despite Mr. Gubitosi's appointment. While the new CEO presumably endorses Elliot's strategic plan to reduce Telecom Italia's stake in its fixed network, success depends on other factors like deal terms and regulatory conditions, the investment bank said.

Write to Patrick Costello at Patrick.Costello@dowjones.com.

(END) Dow Jones Newswires

November 19, 2018 06:33 ET (11:33 GMT)

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