© Reuters. FILE PHOTO: A logo of Italian multinational energy company Enel is seen at the Milan’s headquarter, Italy, February 5, 2020. REUTERS/Flavio Lo Scalzo/
ROME (Reuters) – Proxy adviser Frontis Governance has urged shareholders in Enel (BIT:) to back a list of candidates for the new board promoted by the hedge fund Covalis and reject names put forward by the Treasury, a report seen by Reuters showed.
Investors in Italy’s Enel, one of Europe’s biggest utilities, vote on May 10 to appoint the new board.
The Treasury owns 23.6% of Enel and has faced a growing investor rebellion over the nominees it put forward this month, including its suggestion for chairman — Paolo Scaroni, a former boss at Enel.
Covalis Capital, which holds around 1% of the Italian energy group, has proposed former top banker Marco Mazzucchelli for the chairmanship and presented a slate of independent candidates as an alternative to the government-backed names.
In its report, Frontis recommended that Enel shareholders back the Covalis list.
“Taking into account the level of independence of each slate, diversity and professional competencies of the nominees, we recommend to cast a NO VOTE for the slates submitted by the (Treasury),” Frontis wrote.
Frontis Governance advises Switzerland’s Ethos, a group of pension funds and other investors.
Covalis, a London-based hedge fund, has complained of an “opaque process” regarding Enel, adding it was unclear “what the government’s proposed slate stands for or what their plan is”.
However, it has not put forward an alternative to the Treasury’s nominee for the CEO post — Flavio Cattaneo, a former chief at power grid operator Terna who is currently at high-speed train operator Italo.
