Vivendi Asks to Name Four Members to Telecom Italia's Board
November 15 2015 - 9:40PM
Dow Jones News
MILAN—France's Vivendi SA requested four seats on the board of
Italy's Telecom Italia, in a move aimed at exerting greater
influence over the Italian telecom company and outmaneuvering
another French investor who has recently taken a sizable stake in
the group.
Telecom Italia said Sunday evening it had received a request by
Vivendi to name the four representatives to its board its group's
next shareholder meeting, scheduled for Dec. 15. The French group,
the largest shareholder in the Italian firm, also said it would
propose expanding Telecom Italia's board from 13 to 17 members.
The four representatives proposed by Vivendi are Arnaud Roy de
Puyfontaine, Vivendi's chief executive; Stephane Roussel, the
company's chief operating officer; Hervé Philippe, its chief
financial officer; and Felicité Herzog.
Vivendi, controlled by French businessman Vincent Bolloré ,
steadily built its stake in Telecom Italia over the summer to
become the Italian company's largest shareholder. It currently has
no board seats.
If appointed, the new board members will remain in office until
Dec. 2016, when the board's tenure is due to expire.
The news comes a couple of weeks after Xavier Niel, founder of
French telecom operator Iliad SA, had bought options that, if
exercised would give him a 15% stake in Telecom Italia.
However, soon after Mr. Niel's stake was announced, Telecom
Italia presented a share conversion plan that appeared as a
defensive move. Yet when announcing the plan, the operator said
that it aims at increasing free float and simplify its capital
structure.
The plan, which shareholders will take up at their December
meeting, would see the conversion of the company's savings
shares—which have no voting rights and command a lower price—into
ordinary stock, which have voting rights.
The share conversion would provide Telecom Italia with a €500
million cash injection and would dilute the stakes of current
shareholders, including Vivendi's current 20% which would go down
to just below 14%. But the French company will still be the largest
single shareholder in the Italian firm.
The conversion plan would also dilute Mr. Niel's holdings.
Last week, Mr. de Puyfontaine said the French firm had increased
its stake earlier this year in Telecom Italia in part to offset any
dilution from an eventual share conversion, which has been mooted
by analysts for some time.
Speaking at a conference in Barcelona last week, Telecom Italia
CEO Marco Patuano hinted he would be open to seeing Vivendi—which
has said its investment is aimed at encouraging a tie up with the
Italian company to distribute its content—join the board.
"Whoever will be a long-term investor, I would prefer to have
long-term investors sit on the board than sit on the back seat," he
said.
Write to Manuela Mesco at manuela.mesco@wsj.com
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(END) Dow Jones Newswires
November 15, 2015 21:25 ET (02:25 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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