MILAN: Telecom Italia (TIM) on Friday (Dec 17) said former Chief Executive Officer Luigi Gubitosi is stepping down from the company’s board effective immediately, removing a hurdle that stopped Italy’s biggest phone group from naming his successor.
The agreement with TIM provides a severance package for Gubitosi of about €6.9 million (US$7.8 million) that is to be settled by Jan 3, the company said in a statement.
Gubitosi quit his role as CEO last month after coming under pressure from TIM’s biggest investor Vivendi and losing the confidence of a majority of board members, following a string of profit warnings.
But Gubitosi did not step down as a board director, preventing TIM from naming a new CEO pending a free board seat.
The boardroom crisis has hampered the group’s response to a US$37 billion takeover approach from US private equity fund KKR which is conditional on backing from the company and Italy’s government.
KKR has not yet been granted access to TIM’s data, which it requested before making a formal bid.
TIM, Europe’s sixth-biggest telecoms group, said that a thorough assessment of the terms of the deal is being made, along with a review of strategic alternatives, to decide whether to give KKR access to the data.
Last month, TIM named Pietro Labriola, the head of its prized Brazilian business, as general manager and sources have said he was expected to be named CEO once a board seat became available.
But sources familiar with the process said there were different views on the board as to who would be the best candidate to ensure stable leadership in the longer term. Headhunters have drawn up a list of candidates for the CEO job, the sources said.
It is not clear when TIM will name Gubitosi’s successor, with one source saying it was expected “soon” and another saying it would take longer.
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