The differences on the unbundling of the Telecom network have caused yet another turnaround in the first Italian telephone company with the distrust of the current CEO, Amos Genish, by the American fund Elliott which holds the majority of the board.
The statement released is laconic and clear: “The board of directors of TIM has revoked with a majority decision and with immediate effect all the powers conferred on the director Amos Genish and has given a mandate to the chairman to finalize further obligations in relation to the employment relationship existing with the same". In practice, the ten directors of the Elliott Fund voted in favor and against the five of Vivendi.
The proxies of Amos Genish temporarily pass to the president, Fulvio Conti, but it is not certain that they will remain with him since, according to some rumors, the management could be entrusted to Alfredo Altavilla (former FCA and current member of the board of directors) or to reward Rocco Sabelli (ex Ad Alitalia, also a member of the Board) who, however, has already declined. Both were expressed by the Elliott Fund on the board: Altavilla is also chairman of the nomination committee (which also includes Sabelli as well as Giuseppina Capaldo and Paola Bonomo), a committee that has already been convened to prepare the appointment of the new CEO who will be nominated by next BoD scheduled for Sunday 18 November, shortly. The Telecom Italia share, which had risen in recent days precisely on the basis of incoming news, after opening 2% up, turned negative after the announcement of the new turnaround and reached 0,52 euro around 10 (-0,53 .XNUMX%) when the Ftse Mib – which had also opened upwards – is flat.
In a letter sent to employees, the chairman Fulvio Conti assures management continuity and announces that a new plan will be presented.
LIVE ON THE ATTACK
Inevitable the usual thanks from the Board of Directors to “Amos Genish for the work done in the interest of the company and all its stakeholders in these fourteen months of intense activity". But now the real games start again: will Vivendi stand by and push towards the calling of a new assembly (before April) to take over the management of the group? It may not necessarily succeed: the exit of Genish and before that the devaluation of the assets decided last week on the occasion of the approval of the quarterly data give a strong acceleration to the plans of the Elliott Fund on the unbundling of the network and the agreement with Open Fiber on the new fiber optic network and the sales of Persidera (a transaction on which the French are also in agreement) and Sparkle (which instead sees the two minority and majority shareholders on opposite plans). In any case, the French group reacts harshly to the reversal and attacks Elliott, speaking of "cynical and covert move to destabilize, and carried out while CEO Genish was on the other side of the world”. Indeed, Genish is located in Asia where he has signed an agreement with Samsung (see below). The stock first goes up on the stock exchange then slips and gives 1,5%.
EVEN THE ELLIOTT FUND HURTS
“Genish had an opportunity to create value and Elliott supported that. In reality, no real progress has been made and, on the contrary, it has proven to be an impediment to value creation”. This is the position of the Elliott Fund according to sources close to Tim's shareholder US activist fund with 8,65% representing the majority on the board.
“During his tenure – continues the source – the return for shareholders was -33,5%. For this reason the council decided to let him go. Genish was part of the discredited Vivendi regime and while we were not previously informed of this board decision, we support the revocation. The Board of Directors now has the opportunity to do the right thing and act in the best interests of all stakeholders by adopting Elliott's plan for value creation."
TIM-SAMSUNG AGREEMENT
The telephone group announced today that it has signed an important strategic collaboration agreement with Samsung Electronics in Seoul today, Tuesday 13 November, for the joint launch of TIM's 5G services in Italy and Samsung 5G terminals for TIM. The agreement was signed by CEO Amos Genish and is probably his last act before being disheartened by the Board, on the occasion of the bilateral meetings between the two companies scheduled these days in South Korea.
The two companies specify that “they intend to activate every technical and commercial tool at their disposal to bring forward the launch date of the Samsung 2019G terminals in Italy to 5 and to jointly develop and offer 5G services.
(Last updated at 14:02 on Tuesday, November 13, 2018)
