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Covalis Capital proposes alternative board candidates for Italian utility Enel

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London-based hedge fund Covalis Capital has proposed a rival list of board candidates to those put forward by the Italian government last week for state-owned renewable energy company Enel, according to a report by Reuters.

The report cites a statement made by Covalis claiming that the system that led to the government’s nominations “undermines investor confidence, erodes value and is out of line with international standards of best practice in shareholder democracy.”

The Italian government’s proposals include replacing long-serving CEO Francesco Starace, with Flavio Cattaneo, who currently serves as executive vice president of high-speed train operator Italo, and appointing former Enel and Eni CEO Paolo Scaroni, as chairman.

Enel shares fell by as much as 4% on the day after the government nominations were announced with some investors reportedly concerned over the proposed CEO’s lack of recent expertise in the renewable energy sector. 

In its statement, Covalis said the government’s nominations were the result of an “opaque process”, and it wants to “start a debate” on what the company needs”.

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