Telecom Italia confirmed that Marco Patuano will retain his role as CEO of the company, concluding a series of management decisions that also saw the Italian operator usher in a new chairman and put independent directors in charge of the board for the first time.
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Marco Patuano, CEO of Telecom Italia |
The moves are expected to allow Patuano to focus his full attention on turning around the fortunes of the Italian operator, which has net debt of almost €27 billion ($37 billion) and whose rating has been downgraded to junk status. Patuano has previously pledged to restore the company's credit rating by 2016 through a reduction in debt and improvements in its domestic business.
The confirmation of the CEO followed a board meeting last week that saw Giuseppe Recchi appointed as chairman and the establishment of a new board that is now controlled by independent directors.
Crucially, Telefónica, which owns a majority stake in Telco, is not represented on the board. Telco holds 22.4 per cent of Telecom Italia. Telefónica's growing control over Telco has proved to be a thorn in the side for Patuano as dissident shareholders fear the Spanish company will force a sale of TIM Brasil; Telefónica competes with the Telecom Italia unit in Brazil through Vivo, and has already come under fire from Brazilian anti-trust authorities over its plans to increase control over the Italian operator.
Nonetheless, of the 13 new Telecom Italia board members Telco proposed 10 including Recchi. Dissident shareholder Marco Fossati had proposed Vito Gamberale as a rival candidate for the position of chairman, but none of the candidates proposed by Fossati's Findim group was selected. Recchi, the outgoing chairman of oil group Eni, has no ties with Telco and is deemed to be an independent chairman.
Fossati told Reuters that he welcomed the reshuffle but said he would remain vigilant, and would again seek to revoke the board if a conflict of interest became evident.
The new directors are Lucia Calvosa, Davide Benello, Francesca Cornelli, Denise Kingsmill, Flavio Cattaneo, Giorgina Gallo, Laura Cioli, Giorgio Valerio, Luca Marzotto. Tarak Ben Ammar and Jean Paul Fitoussi were reconfirmed as board members.
Egyptian billionaire Naguib Sawiris recently said he is prepared to invest between $1 billion (€1.38 billion) and $2 billion in Telecom Italia if Telefónica withdrew from the company.
For more:
- see this Telecom Italia release
- see this other Telecom Italia release
- see this Reuters article
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