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ROME/MILAN (Reuters)—Powerful corporate networker Cesare Geronzi, a symbol of old-style Italian capitalism, unexpectedly quit as chairman of Generali after clashing with directors over strategy.
Mr. Geronzi, a 76-year-old former banker appointed a year ago at the helm of Europe's third-largest insurer, faced a no-confidence vote from a majority of board members at an emergency meeting called on Wednesday to discuss his powers, several sources familiar with the matter said.
Mr. Geronzi decided that "as a result of the situation that has developed owing to differences that prevent his involvement in Generali, to resign today from the post of chairman," Generali said in a statement.
Vice Chairman Francesco Gaetano Caltagirone will take over as interim chairman.
The no-confidence motion took the veteran financier by surprise as Mr. Geronzi learned about it only one hour before the meeting was due to start, a shareholder source told Reuters.
His exit from Italy's No.1 insurer marks the end of an era for Mr. Geronzi, a controversial corporate insider with close links to Prime Minister Silvio Berlusconi who had formerly led top banks Capitalia and Mediobanca.
The news triggered a rally of up to 5% in Generali shares, which had lagged peers largely because of what analysts said was Mr. Geronzi's excessive meddling in company strategy despite his non-executive role.
"It is certainly a big step forward because of the problem of governance and it can clarify communications inside the company and with shareholders. It is important," Azimut fund manager Stefano Mach said.
Key to Mr. Geronzi's departure was the withdrawal of support by main shareholder Mediobanca, which owns 13.5 percent of Generali and had been instrumental in appointing him in the first place.
"Mediobanca effectively dumped him," said a senior financial source. "It sends a clear signal that a certain way of doing business cannot continue. For Italy, this is refreshing."
TRIESTE, Italy (Reuters)—Shares in Assicurazioni Generali S.p.A. rose sharply on Monday as investors welcomed a management revamp at Europe's No.3 insurer as well as comments by its new chairman who ruled out plans for a capital hike.