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Vivendi appoints two thirds of Telecom Italia's board
May 4, 2017 / 5:44 PM / 5 months ago

Vivendi appoints two thirds of Telecom Italia's board

The Vivendi logo is pictured at the main entrance of the entertainment-to-telecoms conglomerate headquarters in Paris, March 10, 2016. REUTERS/Charles Platiau/File Photo

ROZZANO, Italy (Reuters) - French media group Vivendi (VIV.PA) tightened its grip on Telecom Italia (TLIT.MI) on Thursday by appointing 10 directors out of 15 to the board of the Italian company.

A Telecom Italia shareholder meeting approved the slate of board candidates submitted by Vivendi, which is Telecom Italia’s top shareholder, with 49.4 percent of votes in favour. Italian fund association Assogestioni appointed the remaining five board members.

The new board, whose size was reduced to 15 from 17, is set to choose a chairman from among its members at a meeting scheduled for Friday.

Vivendi, which has a 24 percent stake in Telecom Italia, put its CEO Arnaud de Puyfontaine top of its list of candidates for the company’s board, which in Italy usually indicates the proposed chairman.

However, three sources close to the matter told Reuters Friday’s board meeting was likely to confirm the current chairman, Giuseppe Recchi, in the job for now as Vivendi awaits a European ruling about its sway over Telecom Italia.

Recchi also featured on Vivendi’s list of candidates, which included the French company’s finance chief Herve Philippe and General Counsel Frederic Crepin.

The choice of Telecom Italia’s next chairman is politically sensitive because it could aggravate concerns in Rome about Vivendi’s growing influence over Italian companies.

Vivendi - which says its stake in Telecom Italia is part of its strategy to build a southern European media empire - filed a pre-emptive notification to the European Commission on March 31, saying that after the shareholder meeting it could de facto control Telecom Italia.

The Commission is due to rule on the matter by May 12.

The French group’s influence over the Italian telecoms group has come under the spotlight after it took a 29 percent holding in Italian broadcaster Mediaset (MS.MI), leading to speculation over whether it planned to combine the two companies.

That angered Fininvest, the investment holding of the family of former prime minister Silvio Berlusconi, and raised concerns in Rome about Vivendi chairman Vincent Bollore’s ambitions.

Bollore is also a key shareholder in influential Italian investment bank Mediobanca (MDBI.MI), which controls insurer Generali (GASI.MI).

Italy’s communications watchdog AGCOM last month ordered Vivendi to cut its stake in either Telecom Italia or Mediaset within a year, saying it was in breach of rules designed to prevent a concentration of power in the telecoms and media sector.

Writing by Agnieszka Flak and Silvia Aloisi; Editing by Mark Potter

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