{ "docId": "019dd923-622c-750b-8b9c-6ca5cdf749cf", "docSlug": "1d2c5c03ff59", "documentTitle": "Telecom Italia SpA (TIM) (TIT.MI)", "authorId": "02_Elliott_Management", "authorName": "Elliott", "documentKindSlug": "activist-deck", "documentKindLabel": "Activist deck", "sourceTypeSlug": "activist_investor", "sourceTypeLabel": "Activist investor", "presentationDate": "2019-03-01 00:00:00", "orientation": "landscape", "aspectRatio": 1.4444444, "pageNumber": 25, "pageCount": 40, "prevPage": 24, "nextPage": 26, "slideType": "villain_critique", "function": "name_villain", "density": "overcrowded", "nDataPoints": 4, "notes": "The slide uses a quote from MSCI ESG Research to frame the critique of corporate governance.", "elementsJson": [ "headline_text", "paragraph" ], "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b9c-6ca5cdf749cf/25", "deckHref": "/decks/019dd923-622c-750b-8b9c-6ca5cdf749cf", "deckJsonHref": "/decks/019dd923-622c-750b-8b9c-6ca5cdf749cf.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b9c-6ca5cdf749cf#slide-25", "components": [ { "bbox": null, "kind": "callout", "text": "Governance risks faced by minority investors at each of these companies will be centered on the alignment of interests with Vincent Bollore.", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd952-ee3b-7248-a18b-caf512a152d5", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.3, "w": 0.8, "x": 0.1, "y": 0.2 }, "kind": "paragraph", "text": "Since the ascent of Vincent Bollore to the Chairmanship of Vivendi, the company's strategy has evolved, with Vivendi taking significant but non-controlling stakes in a number of companies - including Telecom Italia (23.94% stakes), Mediaset (28.8% stakes), Ubisoft (26.6% stakes) and Fnac Darty (11.27% stakes) - seeking to penetrate the boards and influence the direction of these companies. Vincent Bollore's strategy has recently faced higher obstacles due to government interests or other large shareholder blocks which opposed Vivendi's moves (e.g. Telecom Italia). Governance risks faced by minority investors at each of these companies will be centered on the alignment of interests with Vincent Bollore. With Vincent Bollore typically seeking board representation by accruing a sizable stake, but one which does not trigger a requirement for a mandatory bid, a bid premium may not be forthcoming.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "905cce3d-b1d3-454d-a662-7db7fa9d6e73", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.15, "w": 0.8, "x": 0.1, "y": 0.52 }, "kind": "paragraph", "text": "Vincent Bollore effectively controls Vivendi despite holding only 20% of the shares. This influence comes courtesy of a double voting rights provision and the placement of key Bollore allies in senior leadership roles at Vivendi. His interests may dominate board decisions, all the more so that the audit and pay committees lack full independence.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "9f5f165d-aaf1-4fbb-8daa-b59bee1bf4bf", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.15, "w": 0.8, "x": 0.1, "y": 0.68 }, "kind": "paragraph", "text": "This is particularly concerning in light of the apparent poor track record of Vivendi with regards to ethical behaviour; which include allegations of corruption, editorial interference, related party transactions involving other entities of the empire and executive misconduct. This may indicate that the board's functions to effectively oversee and control management decisions in the interests of the investors' base are indeed hindered.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "dc40c588-8d89-4a29-9ec9-0e04792dd9fb", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "quote", "text": "Since the ascent of Vincent Bollore to the Chairmanship of Vivendi, the company's strategy has evolved, with Vivendi taking significant but non-controlling stakes in a number of companies - including Telecom Italia (23.94% stakes), Mediaset (28.8% stakes), Ubisoft (26.6% stakes) and Fnac Darty (11.27% stakes) - seeking to penetrate the boards and influence the direction of these companies. Vincent Bollore's strategy has recently faced higher obstacles due to government interests or other large shareholder blocks which opposed Vivendi's moves (e.g. Telecom Italia). Governance risks faced by minority investors at each of these companies will be centered on the alignment of interests with Vincent Bollore. With Vincent Bollore typically seeking board representation by accruing a sizable stake, but one which does not trigger a requirement for a mandatory bid, a bid premium may not be forthcoming. Vincent Bollore effectively controls Vivendi despite holding only 20% of the shares. This influence comes courtesy of a double voting rights provision and the placement of key Bollore allies in senior leadership roles at Vivendi. His interests may dominate board decisions, all the more so that the audit and pay committees lack full independence. This is particularly concerning in light of the apparent poor track record of Vivendi with regards to ethical behaviour; which include allegations of corruption, editorial interference, related party transactions involving other entities of the empire and executive misconduct. This may indicate that the board's functions to effectively oversee and control management decisions in the interests of the investors' base are indeed hindered. — MSCI ESG Research LLC, June 21, 2018", "attrs": null, "subkind": null, "toolName": "Authority citation", "toolSlug": "authority-citation", "confidence": null, "componentId": "019dd952-ee3b-7248-a18b-cc0e1ded77b9", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.02, "w": 0.2, "x": 0.1, "y": 0.85 }, "kind": "source-note", "text": "MSCI ESG Research LLC, June 21, 2018", "attrs": null, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "fbccbf7c-97e5-4cd5-9ccd-f5a0321a539e", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.03, "w": 0.3, "x": 0.1, "y": 0.15 }, "kind": "title", "text": "THE EMPIRE BUILDING STRATEGY", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "3164ab40-dc52-4ed0-acad-e74decb028a0", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [ { "name": "governance", "slug": null, "matchId": "522cfb3f-ee7c-47e1-9efd-cd3277edd7a6", "evidence": "Critique of board independence, committee structure, and minority shareholder rights.", "confidence": 0.9 } ], "arcBeats": [ { "to": 39, "from": 21, "beatId": "2923adef-f97c-4b6e-b912-edd656f27057", "arcName": "Problem-Agitate-Solution", "arcSlug": "problem-agitate-solution", "beatName": "Solution", "beatSlug": "problem-agitate-solution-solution-provide-relief", "evidence": "The document provides a solution by presenting an alternative slate of nominees and highlighting the benefits of independent governance", "position": 2, "confidence": 0.8, "parentBeatName": "Resolution", "parentBeatSlug": "resolution" } ], "loops": [], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }