Former CEO of Telecom Italia steps down from board

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The TIM logo can be seen at its headquarters in Rome, Italy on November 22, 2021. REUTERS / Yara Nardi / File Photo

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MILAN, Dec. 18 (Reuters) – Telecom Italia (TIM) (TLIT.MI) announced on Friday that former CEO Luigi Gubitosi has resigned from the company’s board, removing an obstacle that prevented Italy’s largest telephone group to name his successor.

The board crisis has hampered the group’s response to a $ 37 billion buyout approach by US private equity fund KKR (KKR.N), which is waiting to gain access to TIM data before doing so. an official offer.

TIM said it was conducting “a thorough assessment” of the offer but also “a review of other strategic alternatives … in order to decide, among other things, to provide access to the due diligence requested by KKR.”

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TIM also said the search for a new CEO is ongoing, but has given no indication of when it might appoint a new boss.

KKR’s offer is conditional on support from the company’s board of directors and the Italian government, but TIM’s largest shareholder, Vivendi (VIV.PA), said it does not reflect TIM’s value. Read more

The French media group is studying an alternative plan, sources said.

Both strategies envision separating TIM’s services from its infrastructure assets, which require investments to be upgraded as part of the country’s multibillion digital push.

SEVERANCE PAY

The deal with TIM provides for severance pay for Gubitosi of around 6.9 million euros ($ 7.8 million) to be paid by Jan. 3, the company said in a statement.

Gubitosi stepped down as CEO last month after coming under pressure from Vivendi and losing the trust of a majority of board members, following a series of profit warnings. Read more

But Gubitosi did not resign as a director, preventing TIM from appointing a new CEO while waiting for a vacant seat on the board.

Last month, TIM appointed Pietro Labriola, the head of its prized Brazilian company, as chief executive and sources have said he is expected to be appointed CEO once a seat on the board becomes available.

But sources familiar with the process said there were different views across the board as to who would be the best candidate to provide long-term stable leadership.

TIM hired headhunters Spencer Stuart, who drew up a list of possible CEO candidates.

“The board (…) is continuing the succession planning process to appoint a new CEO, and will complete it as quickly as circumstances permit,” TIM said.

($ 1 = € 0.8898)

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Additional reporting and writing by Valentina Za, Sneha Bhowmik in Bengaluru, Agnieszka Flak in Milan Editing by Elaine Hardcastle, Rosalba O’Brien and Mark Potter

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