Displaying items by tag: shareholders
British telecommunications operator BT has announced that current CEO Gavin Patterson will depart from his role later in the year after weeks of speculation regarding his position.
Patterson has been subjected to intense scrutiny from BT shareholders who expressed concern at the direction of the group under his leadership. Chairman of BT Jan du Plessis confirmed the CEO’s departure via a statement, citing that recent results indicated that it was clear change was needed to address the slump.
In the statement, du Plessis said, “The board is fully supportive of the strategy recently set out by Gavin and his team. However, the ‘broader reaction’ to recent results has demonstrated to Gavin and me that there is a need for a change of leadership to deliver this strategy".
BT announced last month that it plans to axe over a thousand jobs in a bid to offset cash problems and also confirmed it would relocate its headquarters and move out of its famous London base. BT has in recent years launched a costly push into broadcasting live Premier League football matches, hurting the group's bottom line.
In addition to launching BT Sport during his five years as CEO, Patterson also purchased mobile operator EE from Deutsche Telekom and Orange in a £12.5-billion ($16.8-billion, 14.2-billion-euro) deal.
Following Friday's announcement, BT's share price was down 0.44 percent at 202 pence on London's benchmark FTSE 100 index, which was down 0.8 percent overall in early deals.
"Since 2016, BT's share price graph resembles something of a black run; pretty much always on a downward trend and with a few nasty cliffs here and there," noted George Salmon, equity analyst at Hargreaves Lansdown. Shareholder confidence has followed the share price down," he added.
The CEO of Telecom Italia is set to accept a severance package rumored to be worth around €30m to pave the way for his imminent departure from the organization. Speculation has been rife for a number of months in relation to unrest between the CEO of the Italian incumbent Flavio Catteneo and its largest shareholder Vivendi.
It has emerged that Catteneo is expected to leave the Italian operator by mutual consent after negotiating the terms of the severance package. Vivendi which controls the operators board has been at loggerheads with the CEO for the past number of months, and a source close to Telecom Italia said the situation had become untenable for both parties, claiming ‘something had to give’.
Some shareholders have expressed their criticism to the amount the outgoing CEO will receive for his severance pay-off. However, the CEO was quick to defend the sum pointing out the list of successes he had delivered for the telecommunications colossus.
It has also been reported that Telecom Italia will hold a meeting of its Nomination of Remuneration Committee with only one item listed on the agenda, which is the examination of a proposal of mutual termination of the relationship of the company and Mr. Flavio Catteneo.
However, it was only a few weeks ago, a defiant Catteneo announced his intentions to remain on as CEO until the end of 2020, dispelling rumors he was set to quit the operator. Reports circulated that Vivendi had already lined-up a three-pronged leadership team to replace the CEO.
Tensions continued to soar, but the relationship completely broke down when it emerged that Vivendi planned to appoint its CCO Amos Genish as Telecom Italia’s new Managing Director in order to work alongside Catteneo.
The latest high-profile departure represents a recurring and worrying trend at Telecom Italia. Catteneo’s imminent exit means that the Italian telecommunications colossus will now have its third CEO in just two years. Marco Patuano left the firm in March, 2016, amidst reports of clashes with Vivendi. The French company which is the operator’s largest shareholder is increasingly attempting to extend its control on the operator.
Vivendi now is total control of both the Telecom Italia board and installed its own CEO Arnaud de Puyfontaine as the chairman of the operator earlier this year. In addition, the company gained permission from the European commission to assume control of the operator in May 2017.
However, the company’s progress has not gone unnoticed by Italy’s authorities. Italian regulator Agcom ordered Vivendi to cut its stake in either Telecom Italia or broadcast firm Mediatek in April, to meet stringent Italian media ownership rules. Vivendi is contesting the decision.
Ericsson’s stability has been called into question recently, after a series of events have shaken up the Swedish vendor this year, including the removal of its former CEO Hans Vestberg, reported mass layoffs, and a recent report by Swedish newspaper Svenska Dagladet, which says Ericsson is currently the subject of a dispute between two of its large shareholders – Investor (Wallenberg family) and Handelsbanken bank - one of which is calling for a takeover by Cisco.
The newspaper report cites sources close to the company, and mentions a major power struggle between the two Ericsson investors. Investor reportedly controls 21.50 percent of the voting rights on Ericsson’s board, while Handelsbanken, through its pension fund, Industrivärden, controls 20.05 percent. According to the report, representatives of Handelsbanken dislike Investor’s drastic restructuring measures.
Handelsbanken has accused Investor of halting drastic restructuration measures, saying “we consider that the behavior of Investor reflects the will to put measure on stock prices to compensate for Industrivärden at a low price and then sell to Cisco”. Investor has not disclosed its projects at participating in Ericsson.
Svenska Dagbladet also cites an executive who is worried about the uncertainty prevailing since Ericsson’s former CEO Hans Vestberg stepped down. At the end of July, Jan Frykhammar, Ericsson’s chief financial officer, was appointed as acting director general of the company. But even with Frykhammar in place, instability is being felt throughout the company.
“No one knows at Ericsson who makes the decisions,” an anonymous Ericsson employee told the newspaper. “It is not surprising to see market shares and profitability drop.”
It is worth mentioning that since mid-April 2015, shares have lost 46 percent of their value after a series of deceiving results. Cisco and Ericsson have concluded this year a commercial alliance in networks, aspiring at suggesting a common offer in several fields such as the cloud, and services pertaining to connected things, or even 5G.