Breaking the brokers

27 April 2012 By George Hay, Neil Unmack Follow @gfhay

The Italian antitrust agency has halted bidding for Fondiaria, the country’s second largest insurer. Blocking a currently favoured bid from Unipol would be good news for minority investors. But coupled with new boardroom curbs, it could also strike another blow for corporate reform.

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Italy’s antitrust agency on April 26 opened an investigation into the intended merger between insurers Unipol and Fondiaria-SAI, and suspended the merger process until the end of a 45-day probe.
The authority said the merger risked creating or reinforcing dominant positions in various branches of the insurance sector.
It said the probe will also look at the links between investment bank Mediobanca and Italy’s largest insurer Generali, in which Mediobanca has a 13 percent stake. Mediobanca has lent 1.1 billion euros to Fondiaria.
Mediobanca non-executives Fabrizio Palenzona, the vice-president of Unicredit, and Marina Berlusconi, who chairs Fininvest, stepped down on April 26. Mediobanca chief executive Alberto Nagel left his position as deputy chairman of insurer Generali on April 24.
The departures were prompted by a new law passed in December which bans directors of competing financial services firms from sitting on each others’ boards.

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