The French media and communications group Vivendi has said it will not oppose a plan by Telecom Italia (TIM) to convert savings shares into ordinary stock, despite the fact that this will dilute its own holding. A report from Reuters, which cites ‘a person familiar with the matter’, says the Italian operator’s board has approved the conversion, which could see Vivendi’s interest in the ordinary share capital reduced from just over 20% to around 13.9%. Meanwhile, Xavier Niel, another French investor who recently acquired call options in Telecom Italia, would see his own potential stake reduced from 15.1% to around 10%.
Telecom Italia Chief Executive Marco Patuano has labelled the current dual-share system as ‘entirely anachronistic’. Under the conversion proposals, the telco will offer one new ordinary share in return for each savings share tendered, plus a payment of EUR0.095 in cash. Stock not tendered would be compulsorily converted at a rate of 0.87 ordinary shares for each savings share. The plan is to be put to a vote at a shareholder meeting on 15 December.