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Tim Network, here is Vivendi’s latest move on the board of directors against Mef and Kkr

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Tim Network, here is Vivendi's latest move on the board of directors against Mef and Kkr

Vivendi sent the members of Tim's board of directors the technical opinions requested from five lawyers. Here are the salient theses of the jurists' observations

Vivendi's move on Tim's board of directors against the sale of the network to the American fund KKR.

The French group, main investor of the Italian operator, sent to all the members of the board of directors of the former Telecom the opinions requested last October from five jurists who confirmed that an extraordinary meeting was needed and that it was necessary to go through the related parties committee to carry out the operation.

The French media conglomerate, owned by the Bolloré family, holds a 23.75% stake and more than 17% of Telecom Italia's voting rights. The company led by Arnaud de Puyfontaine (in the photo) is contesting in court the sale of the fixed network to the US fund KKR, an operation worth up to 22 billion euros, arguing that the sale modifies the corporate purpose and the statute of Tim.

In mid-December the French partner in fact presented an appeal to the Court of Milan against the company led by Pietro Labriola, without however requesting the emergency suspension of the network transfer operation.

Subsequently, in January, Vivendi drew Brussels' attention to the operation, citing the role of the Treasury, the largest shareholder of Cdp, which in turn was a significant shareholder of Tim (with almost 10% ), deciding alone and without carrying out the transfer of the operation by the Related Parties Committee.

The sale of the asset is supported by the Italian government, which authorized the MEF to take a stake of up to 20% in the network company as part of an agreement with KKR. TIM expects to finalize the deal, which requires EU antitrust approval, by mid-year.

And now, in view of the board of directors meeting on 14 February, Vivendi has sent the board members the letter of 24 October in which it collected the technical opinions on KKR's offer.

Specifically, the opinions given to Vivendi are signed respectively by Professor Mario Notari, Professor Vincenzo Pinto, Studio Chiomenti (Professor Marco Maugeri and lawyer Filippo Modulo), Professors Giuseppe Ferri and Giuseppe Guizzi and Professor Paolo Montalenti.

All the details.

VIVENDI SENDS THE FIVE PRO VERITATE OPINIONS TO THE BOARD

“Five pro veritate opinions to put on record the basis of Vivendi's opposition to the method (as well as the merit) of the sale of the Tim network to Kkr. And that is, in a nutshell, that it is an illegitimate decision lacking the scrutiny of the extraordinary meeting with "consequent insurgence of the right of withdrawal" and the exposure of the directors to "compensation liability". The index also focuses on the lack of activation of the related party mechanism", summarized Il Sole 24 Ore .

At the end of its letter, Vivendi also attached the opinion requested from Luca Enriques, former Consob commissioner, to sift through what the international accounting standards require regarding related parties.

But what do we read in the opinions that Start Magazine has read?

THE OPINION OF PROF MARIO NOTARI

According to Prof Mario Notari, professor of commercial law at the Bocconi University of Milan, "the divestment operation of the Tim network constitutes a management act which is in conflict with the current statutory rule of the corporate purpose, which makes the joint exercise of the two activities of network management and communications services necessary and essential".

Consequently, – concludes the jurist – it can be legitimately decided and executed by the directors of Tim only after modification of the corporate purpose, with a resolution of the extraordinary meeting adopted with the majorities required by law and by the statute, and with recognition of the right of withdrawal to shareholders who do not vote in favor of the resolution itself".

WHAT PROF VINCENZO PINTO WRITES

Also for Vincenzo Pinto, full professor of Commercial Law at the University of Pisa, "the Operation determines the significant and permanent effect of deviating, in a regressive sense, Tim's activity with respect to the activity program outlined by the art. 3 of the statute, and, consequently, integrates a de facto modification of Tim's corporate purpose prohibited by art. 2361, paragraph 1, cc".

According to Pinto, "to be legitimately carried out, the Transaction presupposes that the protections provided for by the law for shareholders in the face of formal changes to the corporate purpose have been respected, and in particular the deliberative competence of the extraordinary meeting for the prior necessary modification of the 'art. 3 of the statute with the recognition, therein, of the right of withdrawal of non-consenting members (art. 2437, paragraph 1, letter a, cc)”.

SHAREHOLDERS' RIGHT TO CHALLENGE THE TRANSACTION HAS BEEN TRIGGERED

Furthermore, for the professor from Pisa “the decision of the administrators taken in violation of the prohibition established by the art. 2361, paragraph 1, of the Civil Code – in addition to triggering the ordinary remedies against illicit managers – would have a multiple detrimental effect on the rights of shareholders, with the consequent right of shareholders to challenge it pursuant to art. 2388, paragraph 4, second sentence, of the Civil Code (just as a resolution of the ordinary meeting approving the Transaction in the absence of the prior, necessary modification of Article 3 would be non-compliant with the law, and therefore challengeable pursuant to art. 2377 of the Civil Code). of the statute)”.

WHAT PAOLO MONTALENTI WRITES

Paolo Montalenti, professor emeritus of commercial law at the University of Turin, is also of the same opinion, believing that "the Operation is contrary to the corporate purpose, in violation of the Articles of Association and that therefore the resolution of the Board of Directors approving the 'The operation can be legitimately undertaken only subsequently and following an appropriate modification of the art. 3 of the TIM Statute resolved by the extraordinary meeting with the methods and requirements of the law and the recognition of the right of withdrawal pursuant to art. 2437, paragraph 1, letter. a) code civil 13.2.”

WHAT PROFESSORS FERRI E GUIZZI WRITE

In the opinion signed by Giuseppe Ferri, full professor of Commercial Law at La Sapienza University, and by Giuseppe Guizzi, full professor of Commercial Law at Tor Vergata University, we read that "the Operation, far from implementing the corporate object, as is defined by the corresponding statutory clause, it is not limited to being, as mentioned, non-compliant with it, but rather ends up precluding its implementation: in other words, in order to implement the corporate object as concretely defined by the Statute (or, rather, to continue to do so) it would be "necessary" not to carry out the divestment operation but, on the contrary, to abstain from carrying it out, since its execution would end according to a convincing reconstructive hypothesis advanced in a recent doctrinal contribution, that of Bernardo Massella Ducci Teri published in the 2023 Journal of commercial law, entitled The problem of the primordial interests of shareholders: from implicit competences to the modification of the corporate object (I, pp. 133 ss.) – even to integrate the cause for dissolution referred to in art. 2484, paragraph 1, n. 2, cc 6.”

THE OPINION OF THE CHIOMENTI LAW FIRM

Finally, Prof. Marco Maugeri and Avv. Filippo Modulo of the Chiomenti law firm also agree with the previous opinions, putting in black and white that "having regard to the evident "significance" of the network, its possible transfer constitutes a substantial and relevant modification (limitation) of the activity carried out by Tim: as such, it requires a prior modification of the corporate purpose to be delegated to the competence of the extraordinary shareholders' meeting of Tim, with the consequent onset of the right of withdrawal for shareholders who have not participated in the adoption of the relevant resolution".

Therefore, "Even regardless of the (undoubted) right of withdrawal and the existence of an (undoubted) functional connection between the network and the full realization of Tim's corporate purpose, the economic, patrimonial and income relevance of the transferred asset and the impact of the Operation on the property rights of the shareholders require that in any case the unwritten competence of the Extraordinary Assembly be affirmed, according to the models known to the most advanced legal systems".

“Should the Council obliterate the competence of the Extraordinary Assembly and violate the members' right of withdrawal, the decision would be manifestly illegitimate and challengeable pursuant to art. 2388, paragraph 4, of the Civil Code, while its execution would expose the Directors to liability for compensation and revocation for just cause" conclude the lawyers.

This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/rete-tim-ecco-lultima-mossa-di-vivendi-in-cda-contro-kkr/ on Wed, 14 Feb 2024 06:36:21 +0000.