Controversial Telecom Italia’s extraordinary meeting
The EGM has been called to approve the conversion of all saving shares into ordinary shares (item 1). However, the major shareholder Vivendi (20.1%) tabled four new agenda items.
The first one proposes to increase the number of Directors from 13 to 17 (item 2), the second to appoint 4 new members, including 3 Vivendi's representatives and an independent nominee Director (item 3). Vivendi also seeks shareholder approval of the proportional increase in the Board compensation and, last but not least, to release proposed candidates from the noncompetition clause. ECGS strongly opposes these Vivendi’s proposals.
Through this appointment, 23% of Board members will be linked to Vivendi, which will hold approximately 14% of voting shares following the conversion of saving shares. ECGS raises concerns over the overrepresentation of the major shareholder, also taking into account the potential conflicts of interest that may arise between Telecom Italia and Vivendi, due to the proximity of respective businesses.
Furthermore, before the Vivendi's AGM of April 2015, Proxinvest, the French partner of ECGS, raised significant concerns on Vivendi regarding misleading threats against non-French investors, misleading communication, voting of shares by the major shareholder without full economic interest, positions against the "one share-one vote" resolution proposed by the French engagement fund Phitrust Active Investors, management positions in favour of the major shareholder Vincent Bolloré against minority shareholder interests. These decisions impaired the reputation of the Management Board members who are proposed as director of Telecom Italia.
You can find ECGS report written by Frontis Governance, our Italian partner, here.