Giuseppe Recchi becomes deputy chairman; Flavio Cattaneo remains chief executive.

Telecom Italia late on Thursday confirmed Vivendi CEO Arnaud de Puyfontaine as its new chairman, and acknowledged that the French media conglomerate is, for all intents and purposes, its new parent company.

De Puyfontaine replaces Giuseppe Recchi, who will become deputy chairman; Flavio Cattaneo retains his role as chief executive.

In a statement, Telecom Italia said it has decided to "fully equate the reference shareholder Vivendi to a parent company for the purposes of identifying the scope of the related parties of TIM."

De Puyfontaine topped a list of board candidates nominated by Vivendi – which is Telecom Italia’s biggest single shareholder with a stake of 23.94% – in mid-April. The move suggested that he was being proposed as the Italian incumbent’s new chairman. Vivendi’s nominees were duly elected to the board; however, the board itself voted to stick with Recchi as chairman, and de Puyfontaine as vice chairman.

Thursday’s announcement is further confirmation that Vivendi will be the one pulling the strings going forward.

"As Telecom Italia’s largest shareholder, Vivendi intends to pursue a long term-policy focused on development in content convergence. The group welcomes the appointment of Arnaud de Puyfontaine, who will continue to serve as Vivendi’s chief executive officer," said Vivendi, in a brief statement.

The appointment comes just days after the European Commission gave Vivendi conditional permission to take control of Telecom Italia. Vivendi sought approval in April, notifying the antitrust watchdog that in the event that all of its board nominees were elected, it would win two thirds of the board, giving it de facto control of the operator.

One of the first challenges de Puyfontaine faces as Telecom Italia’s new chairman centres on Vivendi’s position in the media market.

The Commission gave its approval for Vivendi to assume control on the condition that it sell Telecom Italia’s broadcasting services arm Persidera. With Vivendi being a global media powerhouse, and also owning 28.8% of Italian broadcaster Mediaset, the Commission was concerned about its ability and incentive to charge TV channels higher prices to access digital TV networks.

De Puyfontaine will also have to find a way of resolving Vivendi’s dispute with Italian telco regulator, L’Autorità per le Garanzie nelle Comunicazioni (AGCOM).

The watchdog in April ordered Vivendi to pare down its stake in either Telecom Italia, or Mediaset. To safeguard media pluralism, competition law in Italy prevents single entities wielding influence in both telcos and media companies.

Vivendi claims that it does not exercise a dominant influence over Mediaset, and plans to challenge AGCOM’s order.