Generali CEO Donnet survives but rebels take board seats -Breaking
Valentina Za and Gianluca Smeraro
MILAN (Reuters). Philippe Donnet, the chief executive at Italian insurer Generali (BIT) was able to keep his job on Friday despite being challenged by rebel investors. This is thanks to institutional shareholders’ strong support.
Although the vote in the company’s annual meeting (AGM), ends the bitter infighting that has characterized Europe’s third-largest insurance provider, there is still uncertainty over the fate of their main rivals who will hold on to 20%.
Mediobanca (OTC) was the leading shareholder backing the nominations of the company’s board members. This helped 56% to vote against 42% who voted for Francesco Gaetano Caltagirone’s rival slate.
Caltagirone received enough votes to guarantee that his name would receive three of the thirteen Generali seats. This could make Donnet’s life difficult.
Caltagirone will take the place of the media and construction entrepreneur because he was the first one to be put forward by his team.
Generali had resigned in January, and Generali’s camp has been pushing Generali to increase its ambitions and deal-making.
Donnet called on unity, speaking after the poll, which took place remotely due to COVID-19 protocols.
He said, “The unanimous choice by a majority shareholders is proof that they believe in our management team”
“Now we all will work in the same direction, with the board management and network of agents…to pursue all stakeholder interests and to ensure that our group succeeds.”
Caltagirone, a billionaire investor Leonardo Del Vecchio were opposed to the Generali board’s proposed list of executive directors.
Caltagirone, a former Generali executive Luciano Cirina was nominated to replace Donnet. Claudio Costamagna is a former Goldman Sachs (NYSE) banker.
Cirina and Costamagna had given their program the title “Awakening The Lion”, in reference to Generali’s nickname “The Lion Of Trieste”.
They wanted to spend as much as 7 billion euros ($7.4 billion) on M&A, compared with the existing board’s plan for 3 billion euros, and have also targeted annual earnings growth of more than 14% with heavy cost cuts and acquisitions.
Roberto Lottici is a Milan-based fund manager for Banca Ifigest. He said that it was now crucial that rival parties engage in a dialog.
Lottici explained that it will be difficult to balance Generali’s brand of’safety, solidity’ and the more bold attitude promoted Caltagirone.
“Let us not forget that challengers have made a significant investment in Generali. They certainly do not want to slow down the company’s development.”
($1 = 0.9462 euros)