PARIS (Reuters) - France’s Vivendi and activist investor Elliott sparred on Monday over how to relaunch Italy’s debt-laden Telecom Italia (TIM), trading accusations ahead of a TIM shareholder vote on March 29.
Both the French media conglomerate and the U.S. hedge fund are shareholders in the Italian telecom company and have long been locked in a power struggle over how to revive the fortunes of the former state monopoly, which is saddled with more than 25 billion euros of debt.
Elliott, with a stake of just under 10 percent, last year wrested control of TIM’s board from Vivendi, which has a holding of nearly 24 percent in the Italian company.
Earlier on Monday, Elliott urged TIM investors to back its plans for the Italian group rather than those of Vivendi at the March vote.
Elliott said in a statement that shareholders had a choice between “stability and the continued recovery of company value, or a return to Vivendi’s poor stewardship with its broken promises, track record of prolonged and pervasive value destruction, and contempt for good governance.”
Vivendi hit back later in a letter, saying Elliott’s statement was “an insult to the intelligence of TIM’s shareholders”, and refuting any suggestion it wanted to control TIM or appoint anyone as CEO or Chairman.
“Vivendi is a long-term investor with ... only one objective: a neutral board that represents all shareholders,” the French company said in the letter.
Vivendi has requested that five directors appointed by Elliott be replaced.
In November, Luigi Gubitosi, one of the Elliott-appointed directors was named TIM’s new CEO, replacing a Vivendi ally.
Reporting by Sudip Kar-Gupta and Dominique Vidalon, Writing by Sarah White. Editing by Jane Merriman