MILAN (Reuters) - The fate of Telecom Italia’s chief executive Flavio Cattaneo was unclear on Friday after a report said there were irreconcilable differences between him and the firm’s top shareholder Vivendi..
Cattaneo, who previously won praise from Vivendi for cutting costs at the indebted Italian firm he has led for just over a year, has been embroiled in a row with Italy’s government over rollout of ultrafast broadband.
The French firm had told Cattaneo to end the row, sources said last week. But sources said this week that tensions persisted, forcing Cattaneo on Tuesday to deny speculation that he might soon leave.
But his position was unclear on Friday. One source close to him told Reuters the CEO had not received any proposal from Vivendi about his position and his departure was not imminent. Another source said he could leave as soon as the weekend.
Shares in Telecom Italia fell 2.7 percent on Friday, which one trader said followed a Bloomberg News report that cited irreconcilable differences between Cattaneo and Vivendi.
When Cattaneo took the helm at the phone group, the 54-year-old negotiated a special award package that could allow him to claim up to 48 million euros if he were asked to leave before the end of his contract in 2020.
Vivendi, which owns a 24 percent stake in the Italian group, has appointed its CEO Arnaud de Puyfontaine as Telecom Italia’s chairman.
Replacing Cattaneo with a Vivendi manager could be another source of discomfort in Italy after the French media group came under scrutiny for taking shareholdings in Telecom Italia and private broadcaster Mediaset.
Sources have also said Vivendi was working to place its senior manager Amos Genish in a top role at the Italian phone group in a move to curb Cattaneo’s powers.
Reporting by Paola Arosio and Giancarlo Navach; Writing by Francesca Landini; Editing by Edmund Blair