Telecom Italia to hold board meeting at Vivendi’s request
Telecom Italia (TIM) plans to hold a board meeting on Nov. 11 in response to pressure from top investor Vivendi after Italy’s biggest telecoms company cut its core profit guidance for the second time in a few months, two sources familiar with the matter said on Saturday.
A source close to the matter had told Reuters on Thursday that Vivendi, which holds a 24% stake in TIM, has been pushing for an extraordinary board meeting to discuss plans to reorganise the company and turn around its domestic business, piling pressure on CEO Luigi Gubitosi.
Vivendi and TIM declined to comment.
Gubitosi, who in February secured a second term with backing from Vivendi and state lender CDP, another leading investor in TIM, outlined plans at a board meeting earlier this week to revamp TIM by extracting greater value from the group’s assets.
Two separate sources told Reuters Vivendi was disappointed with the company’s performance and Gubitosi’s proposals to revamp the company, including plans involving TIM’s key landline grid.
Debt-laden TIM is grappling with falling revenue amid aggressive price competition in its home market. The former phone monopoly had been underperforming its European peers for years, in a sector facing shrinking margins and heavy costs to meet increasing data demand.
The stock has lost 19% since the beginning of the year against a 20% rise in Milan’s blue-chip index.
Gubitosi’s reappointment was originally part of a broader plan championed by Rome, which holds a 10% stake in the group through CDP, to press on with a project to merge TIM’s network assets with those of state-backed Open Fiber, sources had previously said.
But the project has not been taken up so far by the national unity government led by Prime Minister Mario Draghi. Reuters
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