This past weekend, almost by surprise, Jose María Álvarez-Pallete has ceased to be the President of Telefónica. Although rumors of a change at the top of the operator had been circulating for several days, it did not seem that his departure was going to be so sudden. In reality, as soon as the shareholders had a consensus candidate to replace him, they did not wait any longer. Marc Murtra, until now President of Indra, will be the one who takes the reins of Telefónica from now on.
According to a statement from the company sent to the National Securities Market Commission, the CNMV, the operator held an extraordinary board of directors last Saturday in which it was agreed to replace its presidency, with the aim of «adapt it to its new shareholding structure«. In its first lines, the statement indicates that the replacement has been carried out «in view of the new shareholder structure of the company, and that some of its relevant shareholders have expressed the convenience of undertaking a new stage in the executive presidency«.
For this reason, the group’s council has decided what it described as a «orderly renovation» of the presidency. This has resulted in the termination of Álvarez-Pallete’s contract as President, in addition to his resignation as a director of the operator, which the Telefónica Board of Directors has accepted.
After expressing their gratitude to the manager for the work and collaboration with the Telefónica group, and the services provided, its members continued the session approving the appointment of his successor, Marc Thomas Murtra Millar.
Until now President of Indra, Marc Murtra will now be an executive director of Telefónica, as well as executive president of its board of directors.. In addition, Murtra is an independent director and member of the executive committee of Ebro Foods, as well as an Industry Director of Turbo Propellers. Former General Director of Red.es, he was appointed President of Indra at the proposal of the Government in 2021, replacing Fernando Abril Martorell. In addition, he has been Chief of Staff of the Minister of Industry, Tourism and Commerce of the Government of Spain.
He is an industrial engineer from the Higher Technical School of Industrial Engineers of Barcelona (ETSEIB) and has a Master in Business Administration (MBA) from the Leonard School of Business at New York University. He began his career in the nuclear industry at British Nuclear Fuels in the United Kingdom and worked for the strategic consulting firm DiamondCluster, working for several technology companies.
Álvarez-Pallete will receive compensation for his dismissal, which, according to the document sent to the CNMV, “It can reach four years. Each annuity includes the last fixed remuneration and the arithmetic mean of the sum of the last two annual variable remunerations received according to the contract.«. Several sources, such as Cadena Ser, estimate the amount that he will receive at around 45 million euros.
The reasons for the dismissal of Álvarez-Pallete at Telefónica
The departure of the until now President of Telefónica comes after the SEPI (State Company of Industrial Participations), through which the Government has 10% of the shares of Telefónica, The change at the top of the operator was activated last Saturday. The step has come as a surprise to many, since last October he was renewed in his position until 2026.
But the recent entry of several new actors on the group’s board of directors, such as the Saudi STC, which since September 2023 has practically another 10% (9.97%) of Telefónica after a surprise purchase operation of securities for 2,100 million euros, has precipitated the change in its direction. It also led to several changes in its shareholding, since as a reaction to the STC operation, SEPI acquired another 10% of the company’s shares, through an investment of 2,285 million euros.
The entry of SEPI into the shareholding has been taking place progressively. He already had a director at Telefónica, and it is likely that he will now be eligible for a second, while it is very likely that STC will request one. On the other hand, Criteria Caixa has also achieved a share of 9.99%, and hopes to reach a maximum of 10.01%.
In addition to these changes in shareholders, the vice-presidency of Telefónica is currently vacant, since the person who occupied it, Javier Echenique, died in the middle of last December. His position on the operator’s board of directors has also not been filled.
What Marc Murtra has ahead of him at Telefónica
During the mandate of Álvarez-Pallete, who replaced César Alierta in 2016, the value of Telefónica’s shares has fallen by more than 55%, and although the manager has managed to reduce the operator’s debt significantly, Since today it is half of what it was, its debt is still around 30,000 million euros.
Therefore, Murtra has a rather complex task ahead of it, which involves, in addition to reorganizing and modernizing Telefónica’s management so that it can adapt to new technologies and be among the leading companies in the digital sector in Europe, to continue reducing debt, in an environment of closed competition with the rest of the operators, with the low-cost companies making a dent in the number of clients of the first level, and with other technology companies.
In addition, it must ensure that its shareholders achieve greater profitability, for which it must convince them that their bets will be the best for the operator. So far Álvarez-Pallete doesn’t seem to have had much success with it, hence the drop in the stock.
Ángel Escribano replaces Murtra at the head of Indra
The changes at Telefónica have therefore caused another wave of replacements in Indra, which has appointed Ángel Escribano as the new Presidentuntil now CEO of Escribano Mechanical & Engineering, replacing Marc Murtra. The company has also notified the appointment through a statement to the CNMV.
His appointment took place during an extraordinary board meeting of Indra, held a few hours after Marc Murtra was confirmed as President of Telefónica. In this session, Murtra presented his resignation, which was accepted.
Escribano will take charge of Indra with the same salary conditions that Murtra had, and the contract that stipulates the provision of services inherent to his position has already been approved, in addition to granting him sufficient powers to serve as President.
