(Bloomberg) -- Cellnex Telecom SA’s board is set to meet for the first time since activist investor TCI Fund demanded that the chairman be sacked over the handling of a search for a new chief executive officer and questioned the company’s growth strategy.
The 11-member board, which is currently in the process of selecting a new CEO, may meet as early as Monday, according to two people familiar with the matter, who cannot be named because the discussions are private. The board already has a list with several candidates for the CEO position, including former chairman Marco Patuano, No front-runner has emerged and the board could still opt for an internal replacement, according to the people. Eight board members are required to approve naming a new CEO.
TCI Fund surprised investors and the company alike on March 23 when it issued a letter to the board demanding the replacement of three directors, including Chairman Bertrand Kan. The letter, signed by TCI founder Chris Hohn, argued that the company has a lot of potential for growth but is being “held back by poor corporate governance” and that the process to name a replacement for CEO Tobías Martínez had been mishandled.
Read More: Cellnex Faces Hiring Dilemma as CEO Who Piloted Growth Exits
A press officer for Cellnex declined to comment.
Martínez, the only executive who sits on the board, announced in January that he plans to step down on June 3.
His resignation came after Europe’s largest mobile tower operator announced that it would shift strategies, ending eight years of aggressive acquisitions and focus instead on cutting leverage. In his resignation, Martínez said that the new strategy required new leadership.
TCI backs the nomination of Patuano, best known as a former CEO of Telecom Italia SpA, to replace Martínez, according to two people. Patuano served as non-executive chairman of Cellnex for about a year between 2018 and 2019, when he was named by Edizione Holding SpA, the investment group of Italy’ s Benetton family. At the time, Edizione was the largest shareholder in Cellnex with about 29% but the stake now stands at about 8%.
On the same day as it issued the letter, regulatory filings showed that TCI had become the biggest shareholder in Cellnex with 9%.
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