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Elliott Builds Telecom Italia Stake to Take on Vivendi
Paul Singer’s Elliott Management Corp. is building a stake in Telecom Italia SpA as it seeks to counter how the Italian carrier’s largest investor, French media conglomerate Vivendi SA, is running the company, according to people familiar with the matter.
Paul Singer’s Elliott Management Corp. is building a stake in Telecom Italia SpA as it seeks to counter how the Italian carrier’s largest investor, French media conglomerate Vivendi SA, is running the company, according to people familiar with the matter.
Elliott is considering nominating directors to Telecom Italia’s board and pushing for other changes at the company, said the people, who asked not to be identified because the details aren’t public. The activist hedge fund is concerned about Telecom Italia’s share slump and business performance since Vivendi took majority control of the company’s board in 2016, the people said.
Telecom Italia’s annual meeting, where Elliott could table its own nominees for the board, is scheduled for April 24.
Representatives for Elliott and Milan-based Telecom Italia declined to comment. A Milan-based spokesman for Vivendi declined to comment.
Vivendi, which has a 24 percent stake in Telecom Italia, has been under political and regulatory scrutiny in Italy. In September, Italy’s market regulator determined that Vivendi has de facto control over the former phone monopoly, escalating a legal fight. The Paris-based media company, led by billionaire Vincent Bollore, also received a reprimand from the watchdog for buying a stake in Mediaset SpA, the broadcaster founded by former Italian Prime Minister Silvio Berlusconi, as the sides feuded over a pay-TV deal gone bad.
Vivendi replaced Telecom Italia’s chief executive officer last year after ousting Flavio Cattaneo, who cut costs and increased revenue but dented staff morale and clashed with executives at the French media giant. Telecom Italia named Amos Genish, who was previously a Vivendi executive, as CEO in September.
Telecom Italia shares have lost almost 29 percent of their value in the past two years, giving the company a market capitalization of about 14.9 billion euros ($18.4 billion).
Elliott, the New York-based fund run by billionaire Singer, has become one of the busiest activist investors, pushing for changes in at least 25 companies. Its targets include natural resources giant BHP Billiton Ltd., mall owner Taubman Centers Inc. and takeover target NXP Semiconductors NV.
With about $34 billion in assets under management, Elliott is probably best known for a battle with Argentina’s government over that nation’s 2001 bond default. Founded by Singer in 1977, the firm invests globally across strategies including long-short hedge funds, distressed credit, arbitrage, real estate, shareholder activism and private equity.
— With assistance by Tommaso Ebhardt, and Alexandre Boksenbaum-Granier