Former Chief Executive Officer Luigi Gubitosi stepped down from the board of Telecom Italia (TIM) (TLIT.MI) on Friday, clearing the way for Italy's largest phone firm to name his replacement.
The group's reaction to a $37 billion acquisition proposal from US private equity firm KKR (KKR.N), which is seeking access to TIM's data before launching a formal bid, has been hindered by the boardroom upheaval.
TIM said it was doing a "thorough examination" of the proposal, as well as a "study of other strategic alternatives... to decide, among other things, whether to provide KKR access to the due diligence sought."
The search for a new CEO is still ongoing, according to TIM, although no date has been set for appointing a new CEO.
KKR's offer is contingent on the company's board of directors and the Italian government's approval, but TIM's largest shareholder, Vivendi (VIV.PA), has argued it does not represent the company's worth.
Sources have previously stated that the French media conglomerate is considering an alternate approach.
Both plans call for isolating TIM's services from its infrastructural assets, which would require upgrades as part of the country's multibillion-dollar digital drive.
PACKAGE OF SEVERANCE
Gubitosi would get a severance payment of around 6.9 million euros ($7.8 million) under the terms of the deal with TIM, according to a statement from the firm.
Following a succession of financial warnings, Gubitosi resigned as CEO last month after coming under pressure from Vivendi and losing the trust of a majority of board members.
Gubitosi, on the other hand, refused to resign as a board director, blocking TIM from appointing a new CEO until a board seat became available.
Pietro Labriola, the leader of TIM's coveted Brazilian company, was made general manager last month, and insiders indicated he was on the verge of being elected CEO once a board seat became vacant.
However, people involved with the process said there were differing opinions on the board about who would be the greatest candidate for long-term stability.
TIM has enlisted the help of headhunters Spencer Stuart, who has compiled a list of potential CEO candidates.
