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Aerospace & Defense

Proxy adviser ISS recommends vote against Leonardo CEO liability action

2 minute read

Leonardo S.p.A. CEO Alessandro Profumo looks on as he attends during a meeting in Rome, Italy, December 7, 2017. REUTERS/Remo Casilli

MILAN, May 10 (Reuters) - Proxy adviser ISS recommended on Monday that Leonardo (LDOF.MI) shareholders vote against a liability action promoted by activist investor Bluebell against the Italian defence group's CEO citing "the absence of a sufficiently compelling rationale".

Last year CEO Alessandro Profumo was sentenced in the first instance to six years imprisonment for false accounting in his previous role as chairman of Banca Monte dei Paschi di Siena (BMPS.MI).

Bluebell Partners, which owns 25 shares of Leonardo, said it wanted to propose the action and ask for damages stemming from the conviction in a letter to the defence group's chairman dated April 28.

ISS said there was no ground to remove Profumo from his role and undertake any legal action against him as the sentence could still be overturned by the courts in the second or third instance.

In October, Leonardo backed Profumo saying "conditions did not exist" for him to resign.

But the proxy adviser also said Leonardo had omitted to provide information on Bluebell's proposal sufficiently in advance of the first call of the general meeting, scheduled on Monday.

The shareholder meeting is expected to be held on its second call, on May 19.

Reporting by Francesca Landini, writing by Cristina Carlevaro, editing by Giulia Segreti

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