Delfin: three heirs before the judge – no more unanimity

If there is no unanimity amongst the eight Delfin shareholders on any matter, we might as well try to dissolve the company. This line of reasoning – as reconstructed by Radiocor – has prevailed in the recent deliberations of some of the Del Vecchio heirs, who have taken legal action to ask the Luxembourg court to invalidate the now-famous 88 per cent clause, the one that prevents any extraordinary decision being taken within the holding company without the unanimous consent of all family members. In this case, however, the focus is solely on Delfin’s board.

Three shareholders (among whom, it should be noted, Leonardo Maria is not included, even though he is highly vocal in his criticism of the top management) took the matter to court at the start of summer, challenging the quorum requirement that mandates a unanimous vote to replace the directors of the finance company. This is effectively a requirement for unanimity because, with 12.5 per cent each, the votes of seven out of eight shareholders are not enough – albeit by a hair’s breadth – to reach the 88 per cent threshold. In this new legal challenge, therefore, the issue is not the percentage of votes required to amend the dividend cap or authorise the possible reshuffling of shares amongst the heirs – which has so far been purely theoretical – but the procedures by which the composition of the board is altered (some dream of replacing it en masse, others in a more ‘surgical’ manner).

In any case, it is difficult to predict the outcome of the dispute. Proceedings in the Grand Duchy’s courts are not swift, and alliances amongst family members are extremely fluid, depending on which game is being played at any given moment. Some lawyers consulted tend to dismiss it as yet another dispute over Delfin’s articles of association, which are now cluttering the courtrooms of Luxembourg – the seat of the family’s financial empire (which controls EssilorLuxottica and valuable banking and insurance holdings, ranging from MPS and UniCredit to Generali). It is pointed out, however, that this legal action comes just as the Del Vecchio family’s pressure to refresh the board of directors appears more intense than in the past, with the aim of reshuffling the board’s responsibilities.

Internal divisions within the board of directors over the reorganisation plan are also a factor; these have seen, for example, Chairman Francesco Milleri and Chief Executive Romolo Bardin on opposite sides (and this was not the only such instance). Rounding out the five-member board are notary Mario Notari, banker Giovanni Giallombardo and lawyer Aloyse May (plus the two auditors, Lara Forte and Fabio Scoyni). With a Luxembourg judge now effectively a silent partner. When asked for comment, the holding company declined to comment.