(Bloomberg) -- Telecom Italia SpA Chief Executive Officer Amos Genish has been removed following a strategy clash with activist investor Elliott Management Corp. that came to a head this week.

The CEO’s mandate was revoked effective immediately, Telecom Italia said in a statement. Genish, a 58-year-old veteran executive from French media company Vivendi SA, is stepping down because Elliott disagreed with how the carrier would separate its landline network, said people familiar with the matter, who asked not to be identified because the talks were private.

The majority of the board backed the decision, the company said. Chairman Fulvio Conti will take over as CEO on an interim basis and the board will meet on Nov. 18 to decide on a replacement.

Telecom Italia shares fell 0.5 percent to 53 euro cents as of 9:56 a.m. in Milan.

Genish and Telecom Italia’s largest shareholder, Vivendi, wanted the carrier to keep control of the landline grid of the country’s biggest phone carrier, while Elliott, the second-biggest investor, is seeking to spin off more than 51 percent of the business.

The majority of directors backed by Elliott -- 10 out of a total of 15 -- voted against Genish on a conference call to discuss his position Tuesday morning, said the people familiar.

“It was a very cynical move and deliberately planned in secrecy, to create maximum destabilization,” said Vivendi spokesman Simon Gillham, criticizing that the decision was taken while Genish was in Asia on business. “We decry the destabilization of this decision and the disgraceful method.”

Who Is Genish?

Top shareholder Vivendi brought the experienced industry executive over from its Brazil business in early 2017 and got him appointed as Telecom Italia CEO later that year, tasked with improving profitability and shoring up its Brazilian operations.

Elliott has sent mixed signals on whether it backs Genish since it took a stake in Telecom Italia in March and demanded corporate governance reforms and asset sales. It has publicly supported his plan to separate the company’s fixed-line business and spend billions of euros to gain an edge in fifth-generation mobile services, yet has also signaled it opposes much of his approach.

Who Wanted Him Out?

Elliott had made clear it wanted the Israeli former army captain to be more radical in fixing the company, which is staggering under net debt of 25 billion euros ($28 billion) and heavy pension liabilities and has not paid a dividend on its ordinary shares since 2013.

The tension burst into the open in June when Genish criticized unidentified directors for feeding “untrue and unreliable speculation.” The board called him in to explain his comments and he apologized. In September, people familiar with the matter said directors representing Elliott have grown impatient over his handling of the company.

Who Can Replace Genish?

Messaggero reported that Conti was considering board member Alfredo Altavilla and Italian veteran executive Rocco Sabelli as possible successors. People close to the company have also mentioned Altavilla as a potential candidate along with another Telecom Italia board member, Luigi Gubitosi.

  • Gubitosi, 57, is a special administrator of Italy’s bankrupt flag carrier Alitalia SpA and a former Merrill Lynch & Co. senior banker who has led Wind Telecomunicazioni SpA and state-owned television network RAI.
  • Altavilla, 55, was a close aide to Fiat Chrysler Automobiles NV’s late Chief Executive Officer Sergio Marchionne. He was seen as one of the leading candidates for the top job at Fiat before he quit in July.

To contact the reporter on this story: Daniele Lepido in Milan at dlepido1@bloomberg.net

To contact the editors responsible for this story: Rebecca Penty at rpenty@bloomberg.net, Kim Robert McLaughlin

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