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Telecom Italia: Tronchetti Provera Resigns

(Clacton, U.K./Tyres & Accessories) Following the public dispute initiated by Italian Prime Minister Romano Prodi, Pirelli SpA chief Marco Tronchetti Provera has now resigned from his other position as boss of Telecom Italia.

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Although Tronchetti Provera always claimed the acquisition of the Italian mobile telephone company TIM and its integration into Telecom Italia was an excellent strategic move, last week he revealed that a split into two separate companies again would be even better.

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Analysts are seeing this as the correction of an earlier mistake and Prodi, who for many years liked to be acknowledged as a ‘pro-European’ citizen, today only wants to prevent TIM or Telecom Italia from being controlled by foreigners. Prodi said he would even use the so-called “golden share” owned by the government in the even that was necessary.

Various different sources suggest the board of directors would have liked to see Tronchetti Provera stay as boss of Telecom Italia. This, however, didn’t change his mind. His successor is 75-year-old lawyer Guido Rossi, who is obviously willing to change the strategy.

Tronchetti Provera’s resignation cannot be interpreted as an abdication of power because he is and will remain Pirelli’s only important shareholder so he can still influence what’s going on at Telecom Italia in the future. After his resignation as CEO of the company, he can now indirectly decide about what he thinks should be done. But there aren’t too many options for the company, which is suffering from debt of around 41 billion euros – even taking into account the “golden share.”

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