Sunday, 30 April 2017

Proxy firms urge Telecom Italia shareholders to not vote for Vivendi board nominees

By Nick Wood, Total Telecom
Thursday 20 April 17

Glass Lewis, ISS advise holders to support slate of candidates proposed by Assogestioni.

Two proxy advisors this week recommended that Telecom Italia investors should not vote for a list of board candidates nominated by top shareholder Vivendi. The French media conglomerate, which is Telecom Italia's biggest single shareholder with a stake of 23…

Two proxy advisors this week recommended that Telecom Italia investors should not vote for a list of board candidates nominated by top shareholder Vivendi.

The French media conglomerate, which is Telecom Italia's biggest single shareholder with a stake of 23.94%, last week submitted a list of nominees headed by its own CEO Arnaud de Puyfontaine.

Current Telecom Italia chairman Giuseppe Recchi appeared fourth on the list, suggesting that Vivendi intends to replace him with de Puyfontaine.

According to two separate Reuters reports on Wednesday, proxy advisors Glass Lewis and Institutional Shareholder Services (ISS) both urged stakeholders not to back the candidates.

ISS said the list included an 'overboarded director' in de Puyfontaine, meaning that he already sits on several companies' boards.

Both Glass Lewis and ISS said Telecom Italia shareholders should vote for a list of nominees submitted by Assogestioni, an association of Italian asset management companies.

ISS said in the Reuters report that Assogestioni is better positioned to represent Telecom Italia minority holders' long-term interests, and maintain independent oversight.

Telecom Italia shareholders will vote on the candidates on 4 May; a new chairman will be selected the day after.

The news will not have gone down well with Vivendi, which earlier this week was instructed by Italy's telco regulator, L’Autorità per le Garanzie nelle Comunicazioni (AGCOM), to reduce its stake in either Telecom Italia or media outfit Mediaset.

An investigation by AGCOM concluded that its position in the two companies – Vivendi owns 29% of Mediaset – violates Italy's competition laws, which are designed to preserve media pluralism.

Vivendi said it is mulling a legal challenge to the ruling.

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