MILAN (Reuters) - Italy’s market watchdog is investigating the resignations of Telecom Italia (TIM) (TLIT.MI) board members last week, two sources said, after the move which was seen as a bid by top investor Vivendi to challenge activist fund Elliott.
Eight TIM board members nominated by Vivendi (VIV.PA), which owns 24 percent of the Italian phone group, resigned last week, triggering a shareholder vote on a new board on May 4.
Half of those who resigned were independent directors.
The move was seen as a bid to pre-empt attempts by Elliott to challenge the way Vivendi is running the group.
Elliott had called for six board members to be replaced in a bid to improve strategy, value and governance.
Last week’s mass resignations raised questions about why the independent directors decided to leave and to what extent Vivendi exerted control over the former state phone monopoly.
“The regulator has a number of instruments provided for by the law that it can use to carry out its inquiry,” one of the sources close to the matter said.
The options available stretch from asking for more information, such as the minutes from last week’s board meeting, to a search of company headquarters, the person said, adding that the inquiry was at a preliminary stage.
Reporting by Maria Pia Quaglia; Editing by Stephen Jewkes and Susan Fenton