Telecom Italia Favors Luigi Gubitosi in Contest for CEO Job
(Bloomberg) -- Former Merrill Lynch banker Luigi Gubitosi has become the front-runner to be named Telecom Italia SpA’s chief executive officer, people familiar with the matter said, after Amos Genish was ousted this week by allies of an activist shareholder.
Gubitosi has an edge over former Fiat Chrysler Automobiles NV manager Alfredo Altavilla as the favorite to lead Italy’s biggest telecom company, said the people, who asked not to be identified because the discussions are private. No final decision has been made.
The executive is now the favorite because of his telecommunications and media experience, the people said. The 57-year-old corporate turnaround specialist led Telecom Italia’s mobile rival Wind Telecomunicazioni SpA and state-owned television network RAI before the government made him special administrator of bankrupt airline Alitalia last year.
Separately, seven company directors are said to favor Gubitosi, while two would vote for Altavilla, Ansa news service reported Saturday, without citing anyone.
A Telecom Italia spokesman reiterated an earlier statement, saying preparations for the Sunday meeting are underway.
The board is scrambling to restore stability to the company since allies of U.S. activist investor Elliott Management Corp. ousted Genish as CEO on Tuesday after he resisted their call to spin off Telecom Italia’s landline network.
Victory for either Altavilla or Gubitosi would entrench the influence of Elliott, which won control of the board in May with a push for a deeper restructuring of the ailing former monopoly.
Telecom Italia hasn’t paid a dividend on its ordinary shares since 2013 as it labors under heavy debts and pension liabilities. It is now trying to fend off growing competition and shoulder heavy investments in new mobile networks.
Genish’s removal was a blow to French media conglomerate Vivendi SA, Telecom Italia’s biggest shareholder, which brought him in last year as part of plans to create a dominant southern European media company -- only to watch its share price slump 27 percent this year.
Vivendi’s directors on the board would oppose any candidate proposed on Sunday, while one director was undecided, Ansa reported.
Gubitosi’s role at Alitalia underscores his reputation as a turnaround expert and his influence in Rome political circles. He was a head of corporate and investment banking at Merrill Lynch in Italy from 2011 to 2012.
Altavilla is an experienced global manager known for slashing costs at Fiat’s struggling European business when he was a top aide to its former CEO, the late Sergio Marchionne.
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