Vivendi doesn’t think the TIM board is independent enough – hmm

As promised Vivendi has written to the board of Italian operator group TIM in a bid to replace Elliott-nominated members with its own proposed ones.

Here’s the entire text of the letter, dated 14 December 2018: ‘As announced on December 11, 2018, Vivendi wrote today to the Telecom Italia Board of Directors to urge it to convene a Shareholders’ Meeting as soon as possible to vote for the appointment of new financial Auditors.

‘Vivendi also asked that the agenda of the Shareholders’ Meeting includes a vote on the revocation of five Board members from the Elliott list who showed a substantial lack of independence and disrespect for the most basic and fundamental corporate governance rules, negatively affecting the organization and image of Telecom Italia. The Board members concerned by this revocation are: Fulvio Conti, Alfredo Altavilla, Massimo Ferrari, Dante Roscini and Paola Giannotti de Ponti.

‘To replace them, Vivendi asked that five new Board members be proposed to the Shareholders’ Meeting, all independent candidates with strong expertise and proven track records. The candidates proposed include four Italians and are: Flavia Mazzarella, Franco Bernabè, Gabriele Galateri di Genola, Rob van der Valk and Francesco Vatalaro.

‘Biographies of the candidates proposed as Board members are attached.’

The details of this disrespect for corporate governance rules are omitted from the letter as are the details of what these five board members did to show their lack of independence. There was an additional report attached to the letter, however, that does offer more.

Conti is accused of acting in bad faith during the process to turf out the previous Vivendi-supported CEO Amos Genish. Roscini is Lead Independent Director, but is accused of keeping stuff from the Vivendi-nominated ones. Ferrari is accused of speaking out of turn to the press, Altavilla of plotting Genish’s demise, and De Ponti of being complicit in that plot. Basically they’re all accused of sharp practice around the Genish sacking.

Cries of board bias are a bit rich coming from Vivendi which, until earlier this year, had the board stacked mainly with its own nominees. Most of them were nominally ‘independent’, but such was the influence Vivendi was apparently able to exert over the board that the Italian securities regulator was moved to proclaim it had de facto control of the company.

Now that Elliot is enjoying equivalent de facto control of the company Vivendi is crying ‘no fair’, but you can’t have it both ways guys. The Vivendi report stresses it doesn’t have any desire to take control of TIM but given its past form in that area, such claims are difficult to swallow. TIM has published a short announcement acknowledging receipt of the letter and noting that it has already said it will be looking into the auditor situation next month.