Valentina Za and Gianluca Smeraro

MILAN (Reuters), – Generali (BIT) boss Philippe Donnet faces a challenge by rebel investors and is positive he can fulfill his plans for the Italian insurer. Donnet says he’s not worried about the outcome of “soap opera”, which some investors view as a “soap opera”.

The third-largest European insurer, Generali, will present a proposal to Donnet, who is 61 years old, for a third term as the CEO.

However, his reappointment was questioned by shareholder litigation in which Italian billionaires Francesco Gaetano Caltagirone & Leonardo Del Vecchio fought against Mediobanca, the main investor of the insurer (OTC).

Generali’s second and third largest shareholders are Caltagirone, aged 79 and Del Vecchio at 86.

Donnet stated that he isn’t concerned as it doesn’t concern his job in a Milan interview with Reuters.

Generali’s Governance is about 2 very distinct visions. The company’s approach to doing business serves as an example for best practice.

Luciano Cirina was proposed by Caltagirone to be Generali’s CEO. He ran Generali’s Austria and CEE operations until March. Generali has pledged almost double the growth in earnings per share compared to the strategy through 2024 that the group announced in December.

Investors liked the plan, and gave us their support. After meeting with shareholders in New York, London and Boston, Donnet stated that they… appreciated the plan’s ambition, credibility, and realistic nature.”

Donnet, who had successfully guided Generali through the pandemic in his six-year tenure as a helmsman, said that Generali would achieve its financial goals even with the Ukraine war.

He said, “I’m confident we’ll reach the plan’s targets despite all the geopolitical problems.”

When Donnet was asked about Generali’s Russian operations, Donnet stated that the insurance company would be closing down its Europ Assistance operations (as announced) in Russia, which is Volkswagen’s sole customer. However, it would retain its share in Ingosstrakh, the local insurer.

We don’t wish to negotiate with Russian counterparts, it’s too late to sell.

‘RATIONAL BEINGS’

Donnet stated that institutional investors who own roughly one-third of Generali’s capital struggled to comprehend the reason behind what they perceived as an Italian “soap opera”.

Donnet who is dual French and Italian national said that investors are rational and perplexed about what’s happening. It is difficult to understand it for me because I am rational.

The rebel investors are blaming Donnet and their overly timid acquisition strategy. Generali, they claim, has fallen behind AXA (ETR:), rival Allianz (ETR) in terms market value. But, Italy’s leading insurer has earned the sector’s highest shareholder return since 2016.

Generali has earmarked 3 billion euros for mergers and acquisitions (M&A), less than half the 7 billion euros indicated by the challengers.

Donnet said the M&A budget was “enough to clinch good transactions”, adding that while “the pipeline of M&A opportunities is never empty … good deals mature slowly”.

He cited the recent acquisition of French health professional insurance La Medicale. This was a six-year process that required bilateral negotiations.

Generali wouldn’t hesitate to make a purchase if the “dream acquisition” was made. It would also turn to investors for capital to help it raise more money if it needed to spend beyond 3 billion euro.

We are well placed to tap into the cash market. He said that he is confident because he has the trust of his investors.