Telecom Italia (TIM) (TLIT.MI) said on Friday former Chief Executive Officer Luigi Gubitosi had stepped down from the company’s board, removing a hurdle that prevented Italy’s biggest phone group from naming his successor.
The boardroom crisis has hampered the group’s response to a $37 billion takeover approach from U.S. private equity fund KKR (KKR.N), which is awaiting access to TIM’s data before making a formal bid.
TIM said it was conducting “a thorough assessment” of the bid but also “a review of other strategic alternatives … in order to decide, among other things, whether to give access to the due diligence requested by KKR.”
TIM also said the search for a new CEO continued, but gave no indication of when it may appoint a new boss.
KKR’s offer is conditional on backing from the company’s board and Italy’s government, but TIM’s biggest shareholder Vivendi (VIV.PA) has said it does not reflect TIM’s value.
The French media group is studying an alternative plan, sources have previously said.
Both strategies envisage separating TIM’s services from its infrastructure assets, which require investments to be upgraded as part of the country’s multi-billion digital push.
The agreement with TIM provides a severance package for Gubitosi of about 6.9 million euros ($7.8 million) that is to be settled by Jan. 3, the company said in a statement.
Gubitosi quit as CEO last month after coming under pressure from Vivendi and losing the confidence of a majority of board members, following a string of profit warnings.
But Gubitosi did not step down as a board director, preventing TIM from naming a new CEO pending a free board seat.
Last month, TIM named Pietro Labriola, the head of its prized Brazilian business, as general manager and sources have said he was expected to be named CEO once a board seat became available.
But sources familiar with the process said there were different views on the board as to who would be the best candidate to ensure stable leadership in the longer term.
TIM has hired headhunters Spencer Stuart, which has drawn up a list of possible CEO candidates.
“The board … is continuing the succession planning process aimed at appointing a new CEO, and it will complete it as quickly as the circumstances allow,” TIM said.
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