VENICE, Jan 30 (Reuters) - Generali announced a plan on Thursday to offer shareholders over 8.5 billion euros ($8.9 billion) in dividends and share buybacks through 2027, as CEO Philippe Donnet gears up for his reappointment bid.
The largest insurer in Italy has faced internal disputes in the past, with Donnet supported by top shareholder Mediobanca but opposed by two billionaires – including the late Ray-Ban tycoon Leonardo Del Vecchio.
Donnet's tenure is up for review in the spring, and Generali confirmed yesterday that it would not nominate any candidates for the board following objections from the Italian government over proposed succession plans criticized by Caltagirone.
Generali stated that Donnet has conveyed his willingness to extend his term. During a press briefing on Thursday, the CEO expressed confidence regarding the pending shareholder vote on the new board, stating, We are today presenting a very convincing plan for all shareholders, for all stakeholders, and we are very confident for what's going to happen next.
Representatives from Caltagirone on Generali's board reportedly abstained from supporting the plan during the Wednesday vote, as per a knowledgeable source.
Adding complexity, Generali has become a takeover target for state-backed Monte dei Paschi after Caltagirone and Del Vecchio's Delfin took stakes in MPS.
Generali has allocated 1.5 billion euros for mergers and acquisitions as part of its 2025-2027 strategy following a memorandum of understanding with France's BPCE to establish an asset management joint venture managing over 1.9 trillion euros in assets.
The government has raised concerns about the deal, advocating for the management of domestic savings within Italy.
The group will assess M&A opportunities with strict discipline, also benchmarking any potential transaction against share buybacks, Generali confirmed.
Generali aims to increase earnings per share (EPS) by 8-10% annually on average during 2025-2027, with a net cash flow exceeding 11 billion euros, elevating its previous objectives.
The company's shares saw a 0.9% increase in early trading, outperforming Italy's blue-chip index gain of 0.2%.
Analysts from Jefferies lauded Generali's plan as a positive surprise, noting its more ambitious scope than expected.
Share buybacks are planned to reach a minimum of 1.5 billion euros, including 500 million euros earmarked for the current year.
($1 = 0.9599 euros)