A insurgent investor in Generali might mount a authorized problem if his bid to nominate new high executives at Italy’s largest insurer loses by a slender margin in a shareholder vote this month, a candidate for the chairman’s function stated.
In an interview with Reuters, former Goldman Sachs banker Claudio Costamagna stated Generali investor Francesco Gaetano Caltagirone might problem in court docket a victory by the other aspect on the April 29 AGM known as to elect a brand new Generali board if the margin is lower than 6%.
Costamagna – who has been proposed by Caltagirone because the insurer’s new chairman – stated the Italian tycoon’s camp was “hopeful” of securing the vote of Italy’s Benetton household which owns round 4% of Generali and is but to take sides within the feud pitting the development magnate towards Generali’s board and its principal investor Mediobanca.
The holding firm of the Benetton household was not instantly accessible for remark.
The tussle for management of the Italian big – which additionally ranks as Europe’s third-largest insurer – has known as into query the reappointment of CEO Philippe Donnet, who was put ahead by Generali’s board as a 3rd mandate.
With a stake of greater than 9%, Caltagirone is the second-biggest investor in Generali, behind Mediobanca which owns just below 13%.
To counter Caltagirone’s weight and that of fellow Italian billionaire Leonardo Del Vecchio, who’s Generali’s No. 3 investor with a stake of round 8%, Mediobanca has borrowed shares in Generali to provide it a 17.2% voting stake on the AGM.
Mediobanca also can depend on the vote of Italy’s De Agostini group, which plans to promote its 1.4% stake in Generali solely after the AGM and has expressed appreciation for Donnet.
Costamagna stated Caltagirone would problem a victory that mirrored merely Mediobanca’s borrowed shares and the De Agostini stake.
“They’ve about 4.5% borrowed and … the De Agostini stake is already bought … which suggests the day after the AGM they’ve 6% much less,” Costamagna stated.
“In the event that they win by a margin of lower than 6%, they’re not going to be reliable anymore,” he added.
Caltagirone and Generali declined to remark.
The Worldwide Securities Lending Affiliation (ISLA) advises towards utilizing borrowed shares to vote at shareholder conferences.
A supply near the matter instructed Reuters that ISLA, which in 2018 stated that it “has by no means condoned the observe of borrowing securities for the only real function of voting,” had written to Mediobanca on this respect.
Mediobanca stated in an emailed remark that ISLA was reiterating provisions within the UK’s cash market code whose guidelines will not be binding.
“The share lending in query is a market transaction geared toward defending an funding value almost 4 billion euros the place the curiosity of Mediobanca coincides with that of different Generali shareholders,” Mediobanca stated.
The Milanese service provider financial institution stated it might have achieved the identical end result by buying 3% of the insurer via share purchases, with corresponding hedges, which expire instantly after the AGM – a observe which the financial institution stated had been utilized by one other shareholder with out offering the title.
(Reporting by Carolyn Cohn and Pamela Barbaglia in London and Valentina Za in Milan; enhancing by Stephen Jewkes, Kirsten Donovan and Matthew Lewis)
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