Olivetti boss faces series of grillings

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The Independent Online
Francesco Caio, Olivetti's managing director, will be grilled over the next week at meetings with Italian authorities and investors keen to know the true state of the struggling computer maker's finances.

The Italian Prime Minister, Romano Prodi, has also become involved in the affair.

He yesterday met Carlo de Benedetti, who resigned as chairman of the company last week, to ask the financier to brief him on the situation at the company.

Mr Caio's round of talks begins this afternoon with a meeting with the industry minister, Pierluigi Bersani, who will want to know whether the rumours that the group plans to play off 5,000 employees are founded.

Mr Caio will tomorrow appear before the Senate industry committee, and on Monday and Tuesday he faces his toughest test in meetings with investors.

In Milan, then in London, he will be called on by investors to explain question marks hanging over Olivetti's half-year figures released last week.

The affair continues to unsettle investors. Olivetti's stock fell by 7.18 per cent to L560 in Milan yesterday, following the 20 per cent on Monday when some L530bn was wiped from the total market value. There were reports Consob, the market regulator, had asked the group by today to elaborate on seven points on the half-year results.

Doubts that pre-tax losses of L440.2bn last week told the whole story, took centre stage once again yesterday when the company's former director- general, Renzo Francesconi, wrote a letter to the Milano Finanza financial daily apparently denying having called the figures into question.

Mr Francesconi resigned from the Oliveti board last week after telling Milano Finanza that "the situation is much more serious, especially from the financial and economic point of view".

"There can be no negotiation on numbers and cash flow," he told the daily. Whether Mr Francesconi had since retracted that statement was unclear for much of yesterday, but the deputy editor of Milano Finanza, Franaco Bechis, stated that he confirmed "the contents of the original article letter by letter, comma by comma, tone by tone."

Later in the day, Mr Francesconi explained that "what I was denying was not the substance, but the form of that article".

He confirmed his criticisms of the half-year report.