Investors in Enel, Italy's biggest utility, will vote on May 10 on a new board of directors for the company, whose single largest shareholder is the Treasury with a 23.6% stake.

Earlier this month Rome decided to propose a management shake-up at the group, putting forward a slate of six new candidates and ousting current Enel CEO Francesco Starace, who has been at the helm since 2014.

The Treasury indicated Flavio Cattaneo, currently the executive vice president of high-speed train operator Italo and a former CEO at power grid operator Terna, would succeed Starace. The government has also proposed that Paolo Scaroni, a former Enel and Eni CEO, become the company's new chairman as part of the shake-up.

Hedge fund Covalis, an investor in Enel, presented an alternative list of nominees, criticizing the Treasury's appointment process and asking for explanations on Rome's strategy for the group.

In meetings with leading proxy advisers and Enel institutional investors, Treasury officials said Rome would seek no change in the group's current energy transition plan, confirming its role as a leader in renewable energy globally, said the sources, who spoke on condition of anonymity.

The officials added that Enel's new management would target an acceleration of debt reduction through asset disposals compared with a plan presented in November, according to the sources.

Reuters previously reported that the government had grown restless over Enel's debt, which climbed to around 60 billion euros ($66.17 billion) in 2022 from 45.5 billion in 2020, when Starace was reappointed for a third term.

The current dividend policy will be confirmed, Treasury officials told investors, adding that Rome was supporting the entire six-candidate list and was not open to compromise on it.

Covalis presented a six-candidate slate of nominees with former banker Marco Mazzucchelli for the chairman's position. It is pushing for a reform of the corporate governance at Enel with an independent board for the group.

($1 = 0.9068 euros)

(Editing by Paul Simao)

By Francesca Landini and Giuseppe Fonte