Generali CEO wins board backing amid shareholder row (updated)

Caltagirone SpA

27/09/2021 20:09

* Top three investors at odds over choice of next CEO
    * Board throws its weight behind CEO's reappointment
    * Decision to back current CEO fractures board
    * CEO working on new business plan

 (Recasts with board's decision)
    By Gianluca Semeraro and Claudia Cristoferi
    MILAN, Sept 27 (Reuters) - The board of Assicurazioni
Generali  GASI.MI  on Monday threw its weight behind the
reappointment of Chief Executive Philippe Donnet, overlooking
opposition from two leading shareholders in Italy's top insurer,
two people close to the matter said.
    Donnet's fate had been called into question by a boardroom
row at Generali, Europe's third-largest insurer and one of
Italy's most prized financial assets, just as the French manager
prepared to present a new business plan in December. 
    The two sources said Generali's outgoing board had agreed by
a majority vote to file a slate of nominees for shareholders to
vote upon in the spring, including Donnet as CEO.
    The decision was backed by nine of 13 members of the board,
one of the sources said. 
    The source said the board would set up a dedicated committee
to put together the list, with support from headhunters and
legal advisers as well as oversight from Generali Chairman
Gabriele Galateri.
    Donnet's reappointment meets resistance from influential
Italian businessmen Francesco Gaetano Caltagirone, 78, and
Leonardo Del Vecchio, 86.
    The two tycoons, respectively Generali's second and third
largest investors, have criticised Donnet's merger and
acquisition strategy as too timid.
    On the contrary, top investor Mediobanca  MDBI.MI  backs a
third mandate for Donnet, who has steered Generali through the
COVID-19 crisis, keeping it on track to meet targets to the end
of 2021.
    Del Vecchio, founder of Ray-Ban owner Luxottica, and
Caltagirone, a construction magnate, have been steadily lifting
their Generali stakes, while also building holdings in
Mediobanca, piling pressure on its boss Alberto Nagel.
    Earlier this month Del Vecchio and Caltagirone announced an
accord to consult over decisions concerning Generali, where they
control a combined 12.5% stake after a third smaller investor
recently joined their pact.  urn:newsml:reuters.com:*:nL8N2QD04T
    That threshold is not far from Mediobanca's 13% stake in
Generali, which makes the insurer a major contributor to the
profit of the Milanese investment bank, which last week borrowed
more shares in Generali to reach 17.2% of the Trieste-based
insurer's voting rights.  urn:newsml:reuters.com:*:nL1N2QP202
    Del Vecchio, who two years ago rocked Italy's financial
establishment by emerging as the biggest investor in Mediobanca,
has criticised its reliance on the Generali stake.
    Mediobanca has said it would keep the beefed-up voting stake
in Generali until next spring's AGM, where shareholders will
have the last word on the choice of CEO.
    Institutional investors, which account for around 40% of
Generali's shareholder base, will play a key role. urn:newsml:reuters.com:*:nL1N2QQ1G6
    Del Vecchio and Caltagirone are ready to back an alternative
list of nominees for the board's renewal, people with knowledge
of the matter have previously told Reuters.

 (Reporting by Gianluca Semeraro and Claudia Cristoferi; writing
by Valentina Za; editing by Alexander Smith and Angus MacSwan)
 ((valentina.za@thomsonreuters.com; +39 02 6612 9526;))