Italian shareholder spat puts Generali CEO's fate on the line

RAYBAN SUN OPTICS INDIA Pvt

27/09/2021 12:23

* Top three investors at odds over choice of next CEO
    * Decision to back current CEO would fracture board
    * CEO's future in question as he works on new business plan

    By Gianluca Semeraro and Claudia Cristoferi
    MILAN, Sept 27 (Reuters) - Generali  GASI.MI  Chief
Executive Philippe Donnet's future at Italy's biggest insurer
faces a key test on Monday at a meeting of its board to discuss
putting him forward for reappointment in the face of opposition
by two leading investors.
    With Donnet due to present a new business plan in December,
prolonged uncertainty over his future may have negative
repercussions on Generali, analysts have warned.
    Influential Italian businessmen Francesco Gaetano
Caltagirone, 78, and Leonardo Del Vecchio, 86, respectively
Generali's second and third largest investors, oppose his
reappointment, saying Donnet's merger and acquisition strategy
is too timid.
    But 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 lifting their
stakes in Europe's third-largest insurer and one of Italy's most
prized financial assets.
    In parallel, they have also built stakes in Mediobanca,
piling pressure on its boss Alberto Nagel.
    And this month Del Vecchio and Caltagirone unveiled 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
    Generali's appointments committee on Friday recommended that
the board files a slate of nominees, including Donnet, for
shareholders to vote on in 2022. Institutional investors account
for around 40% of Generali's shareholder base. urn:newsml:reuters.com:*:nL1N2QQ1G6
    The resolution passed with four votes in favour and three
against, according to people close to the matter.
    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.  

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