MILAN (Reuters) -Two activist investors in Generali are considering ending their accord to consult over decisions concerning Italy’s biggest insurer, two sources close to the matter said, after the agreement drew regulatory scrutiny.
Europe’s third-largest insurer is at the centre of a shareholder battle that has cast doubt on the reappointment of CEO Philippe Donnet, whose term ends in April.
With the backing of Generali’s biggest investor Mediobanca, the insurer’s board has put Donnet forward for a third term, meeting opposition from two other leading investors.
Italian billionaires Francesco Gaetano Caltagirone and Leonardo Del Vecchio who are, respectively, Generali’s No.2 and No.3 shareholders, in September agreed to consult over decisions relating to the insurer with a view to promoting “a more profitable and effective management” of the group.
Smaller Generali investor Fondazione CRT later joined their pact.
Caltagirone unexpectedly quit the pact in January as he prepares to file a list of nominees for Generali’s new board with an alternative CEO candidate.
Sources said at the time the move aimed to prevent regulatory checks on whether the agreement was a mere consultation pact or more substantial than that.
Now Del Vecchio and CRT are discussing dissolving the pact altogether, the sources said. Lawyers are studying the matter, one of the sources added.
SEEKING CHANGE
CRT said in a note it had discussed the issue at a meeting on Tuesday without taking a decision. The pact complies with existing rules and aims to help CRT to better evaluate its interests in relation to the upcoming Generali AGM, CRT said.
Even if it is dismantled, the group’s common goal remains that of pushing for changes at Generali, one of the sources said on Tuesday.
The discussions over scrapping the pact come after Generali last week asked industry supervisor IVASS to check whether the three investors should have gained clearance for their combined stake.
The three hold in aggregate more than 16% of Generali based on the latest data available, after Del Vecchio and Caltagirone steadily upped their Generali stakes.
Both Caltagirone and a representative for Del Vecchio this year quit Generali’s board in a move that freed them from disclosure obligations, barring the crossing of certain thresholds.
IVASS has the power to freeze the group’s voting rights for the portion exceeding a 10% combined holding were it to ascertain the three should have sought authorisation for the stakebuilding.
(Writing by Valentina ZaEditing by Keith Weir)
