REFILE-UPDATE 1-Telecom Italia's top stakeholder proposes Eni head as chairman

Wed Mar 19, 2014 2:38pm EDT

(Adds dropped first name Tarak in penultimate paragraph)

* Shareholders to vote on new board on April 16

* Telco list includes 9 independent directors out of 13

* Chief Executive Marco Patuano remains on board

By Danilo Masoni

MILAN, March 19 (Reuters) - Telecom Italia's largest shareholder, Telco, has proposed as new non-executive chairman Giuseppe Recchi, currently the chairman of energy group Eni, in a list of mostly independent candidates for the new board.

Telecom Italia shareholders meet to vote on April 16 when the current board's three-year term expires.

In a break from the past when the Telco consortium led by Spain's Telefonica had the power to appoint a majority of Telecom Italia's directors, Telco on Wednesday proposed mostly independent candidates for the new board.

The move follows a campaign by minority investors led by 5 percent shareholder Marco Fossati to reduce Telco's influence in the boardroom after accusing management of not acting in the interests of minority shareholders.

Fossati on Wednesday proposed his own candidate as chairman, 69-year-old Italian businessman and former Telecom Italia executive Vito Gamberale, currently the CEO of infrastructure fund F2i.

Fossati's holding company Findim said Gamberale has helped draw up a new business plan for Telecom Italia which will be presented to investors in the coming weeks.

In particular Telco's opponents have been worried that Telefonica could force a sale in Brazil of Telecom Italia's primary growth business, TIM Participacoes, which competes with Telefonica Brasil's Vivo.

Brazil's competition regulator wants Telefonica to cut its indirect interest in TIM Brasil or seek a new partner for Vivo but has given the Spanish firm until the middle of next year to find a solution.

The list of 13 directors proposed by Telco includes current chief executive Marco Patuano, who was appointed last year to take on the task of reviving the company by cutting its near 27 billion euros ($38 billion) of debt and save cash for much needed network investments.

"The list ... reflects a suitable blend of managerial and professional figures and candidates with international standing," Telco said in a statement.

Telco is owned by Telefonica, Italian insurer Generali and two banks, Intesa Sanpaolo and Mediobanca and owns 22.4 percent of Telecom Italia.

Besides Recchi, a former GE manager who joined Eni in 2011 as chairman, Telco's proposed list of board candidates includes eight other potential independent directors.

In addition Telco wants current directors Tarak Ben Ammar and Jean Paul Fitoussi reappointed to help provide continuity in the management, Telco added in the statement.

Telco said Telefonica's representatives in Telco voted in favour of the list of candidates but did not propose their own. ($1=0.7189 euros) (Editing by Greg Mahlich)

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