Vivendi attacks Elliott directors on TIM board for ‘tensions and conflicts’

17 December 2018 | Alan Burkitt-Gray

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Vivendi has stepped up its war on TIM investor Elliott by attacking the way it weakened the position of previous CEO Amos Genish, who was removed on 13 November.

At the same time Vivendi is calling for five Elliott nominees on the TIM board to be replaced with five of its nominees, including former Telecom Italia CEO Franco Bernabè.

The French media group says the Elliott-nominated board oversaw a “reckless breach of corporate governance rules” and adds that “tensions and conflicts within the board (including within the Elliott candidates) have severely undermined the market’s trust in the ability of TIM’s management body to direct the growth and the development of the company in a medium- to long-term perspective”.

It characterises Elliott as “a hedge fund that makes its investments for financial – as opposed to strategic – purposes, with the aim of achieving high returns in the short term”.

Vivendi, which is the biggest single shareholder in TIM with close to 24%, says Genish (pictured) was removed “through parallel and hidden decision-making processes”. It says it believes “the board of directors is no longer representative of the interests and expectations of all the shareholders that – at the shareholders’ meeting of 4 May 2018 – voted in favour of the slate submitted by Elliott on the assumption that the company was to be led by Amos Genish”.

It wants five of the directors nominated by Elliott to be removed and replaced by Bernabè and four others nominated by Vivendi.

Bernabè was CEO of Telecom Italia, as the group then was, for six months from November 1998, and then again for two years from 2008; he was then executive chairman for three years. Bernabè also chaired the GSMA for a period. Vivendi nominated him to the board in 2017. 

Vivendi also notes that PwC’s mandate as auditor expires on 31 December and calls for a shareholders’ meeting for the appointment of a new auditor from 1 January. “TIM has not provided any information to its shareholders” on the process to select a new auditor, and the next board meeting is not until 17 January.