MILAN, April 16 Telecom Italia
investors gathered on Wednesday to vote on a board restructuring
that will for the first time put a majority of independent
directors in charge of overseeing Italy's largest phone group.
In the reshuffle, executives from top shareholder Telefonica
will no longer sit on the board.
That move is aimed at placating minority investors concerned
about a possible conflict of interest, given that the Spanish
and Italian firms operate as competitors in Brazil. It is also
designed to help chief executive Marco Patuano focus on turning
around the heavily indebted Italian group.
Shareholders will vote on three distinct lists of
candidates, all of which would give independent directors a
majority on the board.
Investors with a combined 51 percent were present as the
meeting started, outgoing Chairman Aldo Minucci said, adding
that Telco was present with its 22.4 percent stake, dissident
investor Marco Fossati with 5 percent and U.S. fund Blackrock
with 4.8 percent.
Telecom Italia's board has been dominated for years by
holding company Telco, a Telefonica-led group that owns 22.4
percent of the Italian firm. The lack of adequate representation
for minority investors sparked a shareholder revolt led by
Fossati last year.
Telefonica's head Cesar Alierta and Julio Linares, a former
chief operating officer at the Spanish company, resigned from
the Telecom Italia board in December.
Concerned that dissatisfaction could mount, Telco proposed
in March a new board of independent figures led by chairman
candidate Giuseppe Recchi, a former General Electric
executive and outgoing chairman of oil group Eni.
The new board will hope to tap into the recovering Italian
economy, which is starting to pull clear of its worst recession
in 70 years.
Under its stewardship, Patuano will have to execute planned
disposals for 2 billion euros, including the sale of
communications towers in Brazil and Italy, to cut debt and
upgrade networks to capture growing demand for broadband.
He may also face hard choices when it comes to the Italian
group's future strategy in Brazil, where Telecom Italia unit TIM
Brasil competes directly against Telefonica's Vivo.
Sources close to Telefonica have said the Spanish group aims
to break up TIM Brasil and share its assets among other telecom
players. Fossati has spoken against such a prospect and proposed
combining TIM Brasil with broadband operator GVT, a unit of
Recchi is likely to win the majority of votes he needs to
become board chairman at Telecom Italia, but he is being
challenged by veteran telecom executive Vito Gamberale, who has
been proposed by Fossati for his extensive sector experience.
(Reporting by Danilo Masoni; additional reporting by Stefano
Rebaudo; Editing by John Stonestreet)