Billionaires battle CEOs at Italy’s Generali and Mediobanca By Reuters
© Reuters. FILE PHOTO – The Generali logo can be seen in Milan’s CityLife area, Italy on November 5, 2018. REUTERS/Stefano Rellandini
MILAN (Reuters) – Power struggles at insurer Generali (MI:) and Mediobanca (OTC:) have billionaires Leonardo Del Vecchio and Francesco Gaetano Caltagirone pitted against the CEOs of both groups.
The key facts are in the growing conflict between Italy’s top investment bank, and its largest insurer. This group holds 61billion euros of Italian government bonds.
TYCOONS IN GENERALI PACT
Del Vecchio, 86, Caltagirone, 78, clinched a shareholder pact in September to consult over decisions concerning Generali ahead of a general meeting in early 2022 to name a new board.
Following the recent addition of a third small investor to their pact they control 12.5%. The two are also opposed to Philippe Donnet’s third mandate as Generali CEO, which has Mediobanca support.
They have criticised Donnet’s M&A strategy as too timid, but have not explained what their alternative plan is.
MEDIOBANCA UPS GENERALI VOTING STAKE
Mediobanca last week borrowed shares to secure 17.2% of the voting rights in Generali until its AGM next year.
Mediobanca, the largest investor in Generali, receives a third its revenues from Generali’s 13% share.
GENERALI BOARD DIVIDED
Generali’s outgoing board on Monday agreed by a majority to file a slate of nominees for the April 2022 shareholder vote, including Donnet as CEO. This decision was supported by 9 of 13 board members, and opposed by 4 representatives of the two tycoons.
Del Vecchio proposed changing the merchant bank’s by-laws at a shareholders meeting on Oct. 28, stepping up pressure on Mediobanca’s top management. Del Vecchio said that he wasn’t pushing for board or management changes.
Luxottica’s founder, with an 18.9% share of the bank’s capital, is its single largest investor. Caltagirone also owns a 3.3% share in Mediobanca. This puts pressure on Alberto Nagel, the bank’s CEO.
Caltagirone and Del Vecchio are expected to present their own slate of nominees for Generali’s board, suggesting an alternative candidate as CEO. In preparation for the April AGM, they are seeking alliances.
After announcing that it would be leaving the Milanese bank’s shareholders agreement, Italy’s Benetton family is in the news. They own 4% of Generali, and 2% each of Mediobanca.
Around 40% of Generali is owned by institutional investors. Their vote at the AGM would have a decisive impact.
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