Vivendi: Telecom Italia Auditors' Report Reveals Governance Irregularities - Update
March 11 2019 - 4:50AM
Dow Jones News
(Adds Elliott comments, background)
By Pietro Lombardi
Vivendi SA (VIV.FR) says it is "extremely concerned" by a report
from Telecom Italia SpA's (TIT.MI) auditors that it says confirms
the existence of serious irregularities related to the governance
of the company and its board of directors.
The comments come ahead of a March 29 meeting at which Telecom
Italia shareholders will vote on a proposal to remove five board
members backed by Elliott Management Corp.
"This report reveals that the chairman of the TIM board violated
corporate laws as well as the most basic, fundamental governance
rules," the French company said late Friday.
The report shows there is a "shadow board of directors,"
including only members nominated by Elliott, as well as "a
dissemination of privileged information to third parties prior to a
board meeting," the media company said.
"These concerns reinforce Vivendi's belief that TIM shareholders
must put in place a truly independent board at the March 29
shareholders' meeting."
Vivendi has been seeking to replace five board members supported
by Elliott with independent directors.
Elliott said Monday that Vivendi's nominees are "unsupportable
[and] lack true independence, and would simply return control to a
group with demonstrable conflicts of interest, related-party
transactions and a history of undermining TIM shareholders."
Vivendi is Telecom Italia's largest shareholder, with a stake of
almost 24%. It has been locked in a long-running battle for control
of the company with activist investor Elliott Management, whose
nominees form a majority on the Italian company's board.
Read more about the imbroglio surrounding Telecom Italia at
https://on.wsj.com/2TlJwWy (WSJ paywall) or https://bit.ly/2KuPhKY
(NewsPlus).
Write to Pietro Lombardi at pietro.lombardi@dowjones.com
(END) Dow Jones Newswires
March 11, 2019 04:35 ET (08:35 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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