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French shareholder has met with possible replacements for Patuano, seeks to transform telco into Southern European media group, sources say.
Despite its protestations to the contrary, it seems Vivendi is keen to alter the direction of Telecom Italia’s strategy, and that means the Italian incumbent’s CEO could find himself in the firing line.
The French media firm is becoming impatient with Marco Patuano’s leadership and is reviewing his position, Bloomberg reported on Thursday.
Vivendi has increased its stake in Telecom Italia a number of times recently, and now holds 23.8%.
Citing people familiar with the situation, Bloomberg said Vivendi CEO Arnaud de Puyfontaine has met with potential candidates to one day replace Patuano if he does not push the company in the direction favoured by Vivendi; the French firm wants to transform Telecom Italia into a Southern European-focused media outfit.
The sources said Vivendi’s top management met with Patuano in Paris on Wednesday to discuss the telco’s strategy, including its cost-cutting plans, the revamp of its domestic business, and its options in Brazil.
TIM Brasil has been the subject of takeover speculation for a number of years, with Telecom Italia at times insisting the unit is a strategic asset, while at others indicating that it might be willing to consider the right deal.
Last year Russian investment group LetterOne Technology pledged to plough US$4 billion into another Brazilian mobile operator, Oi, if it brokered a merger deal with TIM. However, last week the firm withdrew the funding offer, having been informed by Telecom Italia that it did not wish to conduct further negotiations.
Vivendi would like to see Telecom Italia exit Brazil and focus on Europe. It sold its own Brazilian business, broadband operator GVT, to Telefonica last year, ending up with a stake in Telecom Italia as part of the deal.
The past nine months have seen Vivendi build its Telecom Italia stake and seek to exert more influence over the telco.
It was successful in increasing the size of the Telecom Italia board to incorporate more of its own representatives in December, and managed to block the Italian telco’s share conversion plan. This, despite insisting that it was not aiming to heavily influence its strategy or pursue a full merger between the two companies.
Nonetheless, Bloomberg’s sources said Patuano’s future is as yet undecided; he may still keep his job.
