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Vivendi defends its cunning plan for Telecom Italia

by on17 April 2018

The Italians need stability

French media group Vivendi defended its cunning plan for the creaking and out-of-date Telecom Italia claiming that it is best placed as the number one shareholder to provide stability for the former monopoly.

Vivendi, which holds a 24 percent stake in TIM, is facing a challenge from activist hedge fund Elliott Advisors, which has built a nine  percent stake in Telecom Italia and wants to make changes to its board

“Vivendi can provide stability and expertise while enabling other shareholders to invest and participate in any future upside,” the French group said in the document. “We are also committed to preserve Telecom Italia as an Italian company with Italian governance and representation."

Last year, Vivendi, using its position as TIM's largest shareholder and backed by investment funds, appointed two thirds of Telecom Italia's board and picked its CEO Arnaud de Puyfontaine as chairman. It also made Amos Genish, a favorite of Vivendi's Chairman Vincent Bollore, CEO of the Italian group.

However Vivendi's belief in its own superiority is not widely endorsed by those in Italy who see the outfit's management of the Telco as pretty pants. TIM has lost a quarter of its market value since Vivendi first took a stake in the middle of 2015. The French company is now TIM's biggest investor with just under 24 percent.

Italy's outgoing Industry Minister Carlo Calenda told daily la Repubblica that Vivendi has been an "awful" investor in Telecom Italia.

"I am in favour of foreign investments, but this does not mean standing aside when they destroy value rather than creating it, especially when there's a strategic interest at stake", Calenda said in the interview.

Vivendi's management of the company has led to tensions with the Italian government and Rome eventually decided to use its so-called "golden powers" to ensure it had a say in some key decisions.

The French company is also facing a challenge from activist hedge fund Elliott, which has a built a 9 percent stake, and wants to make changes to TIM's board.



Last modified on 17 April 2018
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