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InvestmentsUnder-fire Telecom Italia CEO faces board showdown By Reuters

Under-fire Telecom Italia CEO faces board showdown By Reuters


© Reuters. FILE PHOTO: Telecom Italia’s new brand for the TIM model is seen on a constructing in Rome, Italy, April 9 2016. REUTERS/Alessandro Bianchi/File Photo

By Elvira Pollina

MILAN (Reuters) – Telecom Italia (MI:) (TIM) CEO Luigi Gubitosi faces the board on Thursday at a gathering sought by high investor Vivendi (OTC:) following two revenue warnings in three months at Italy’s former cellphone monopoly.

Having didn’t stem a gentle income decline in TIM’s crowded home market, Gubitosi final month outlined to the board plans to squeeze money out of the group’s property, together with its prized fixed-line grid that provides providers to hundreds of thousands of Italian households and companies.

His proposals, aimed toward bringing in new buyers into the property of the debt-laden firm, have didn’t get Vivendi’s backing finally month assembly, folks near the matter have stated.

The French media group needs to have a much bigger say over the destiny of TIM’s community property, which it needs to determine in settlement with the Italian authorities, the folks added.

Options for the asset revamp can be mentioned on Thursday on the assembly requested by administrators Arnaud De Puyfontaine and Frank Cadoret, who characterize Vivendi, and different three impartial board members, sources have stated.

Vivendi holds 24% of TIM, an funding exposing it to a possible 1.8 billion euro capital loss at present market costs.

TIM’s community property are deemed strategic by the federal government, and Treasury-owned CDP has constructed a 9.8% stake within the group to supervise them and assist counter Vivendi’s affect.

Both the French group and CDP in March backed Gubitosi’s reappointment and CDP is for now resisting Vivendi’s efforts to query his place, sources have instructed Reuters.

Innovation Minister Vittorio Colao, a former Vodafone (NASDAQ:) boss now answerable for Italy’s ultra-fast broadband push, will play a key function in settling the way forward for the TIM CEO.

Colao has poured chilly water on a venture championed by the Treasury beneath Italy’s earlier authorities to merge TIM’s fixed-line entry community with that of state-backed rival Open Fiber.

Sources have stated Gubitosi has been attempting to revive the plan by convincing Vivendi that TIM ought to cede management of the merged entity, an choice the French group had all the time opposed.

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