Institutional Shareholder Services (ISS) has reportedly recommended Telecom Italia (TI) investors vote in favour of a minority shareholder-led proposal to replace the telco’s board.
Proxy advisers ISS said in a client report that, on balance, removing…
Institutional Shareholder Services (ISS) has reportedly recommended Telecom Italia (TI) investors vote in favour of a minority shareholder-led proposal to replace the telco’s board.
Proxy advisers ISS said in a client report that, on balance, removing the current board would likely benefit long-term shareholder value, Reuters reported. As such, the firm recommended shareholders vote for the board’s removal at the meeting set for 20 December.
Marco Fossati’s family holding company Findim, which has a stake of just over 5% in TI, and small shareholders group Asati have strongly criticised the telco’s new strategic plan, arguing it prioritises the interests of larger shareholders.
Holding company Telco, in which Spain’s Telefonica has the largest stake, is TI’s main shareholder with a 22.4% interest.
In mid-October, TI revealed that Findim had called for a shareholder meeting to remove directors representing Telco from the company board. Findim has been quoted as saying it would vote for a slate of directors presented by the Italian Asset Management Association (Assogestioni).
ISS reportedly argued Assogestioni’s slated board membership would likely contribute to boosting long-term shareholder value.
Telco has already said it will vote against the proposed board removal at the shareholders’ meeting on 20 December.
Last week, Reuters reported that early electronic voting data showed funds owning more than 60 million TI shares (0.5% of the total stock capital), were voting against the board removal, while none voted in favour. Holders of more than 20 million shares abstained.
If the board removal proposal fails, TI will move ahead with the three-year strategic plan outlined in early November by CEO Marco Patuano. Designed to raise €4bn (US$5.3bn), the plan includes multiple asset disposals.
