Italy

EU sovereign debt fix fails Italian test

24 May 2018

The European Commission wants to make it easier for investors to buy bonds that pool euro zone government debt. It’s part of a plan to reduce banks' exposure to indebted states. Recent Italian worries show such securities might help, but also why they are unlikely to work.

Italy premier’s to-do list would tax a veteran

24 May 2018

Newcomer Giuseppe Conte has vowed to defend the country’s interests in all quarters. If confirmed by parliament, he will face EU conflict on an upcoming budget, the future of Alitalia and Monte dei Paschi, and new asylum laws. All would be tough even if he wasn’t a total novice.

Italy’s next economy minister is the one to watch

22 May 2018

Radical parties have proposed little-known academic Giuseppe Conte to head their government. Yet the economic portfolio matters more for the indebted country’s future. The new minister’s attitude towards the euro will go a long way towards determining investors’ faith in Italy.

Italy has room to bluff its way with Europe

21 May 2018

The likely government’s plans to boost spending and keep Monte dei Paschi state-owned break European rules. A revived economy, low rates and weak EU leadership give it a better hand than previous rebel Greece. And Europe needs to avoid a clash that could end the single currency.

Italian radical agenda is a recipe for chaos

16 May 2018

A leaked plan by likely coalition allies 5-Star Movement and League says states should be able to exit the euro zone and cancel debt. That, along with a soaring budget and proposals for a shadow government, promise conflict with the EU. Bond markets are too complacent on Italy.

Italy’s radical government will be an EU headache

14 May 2018

The maverick 5-Star party and rightist League are nearing a coalition. Plans to cut taxes and boost social spending will clash with the euro zone’s strict fiscal rules. The new government may also demand more EU help with migrants. It’s a break from Italy’s pro-European stance.

Trimmer Monte dei Paschi could speed cleanup

11 May 2018

The state-owned Italian bank pleased investors with a return to the black and plans to shed more dodgy loans. At 10 pct of total lending, net dud credits are still too high. If the bank cuts costs to the level of stronger peers, it will have more room to scrub its balance sheet.

UniCredit may be stuck with costly crisis capital

10 May 2018

The Italian bank should not be able to treat the proceeds of a 2009 hybrid issue as equity, a hedge fund argues. CEO Jean Pierre Mustier might prefer to get rid of the expensive instruments. But it’s hard to extract UniCredit from the transaction without upsetting investors.

Italian election sequel could favour right wing

8 May 2018

Failure to form a coalition government after the inconclusive March vote raises the chances of a snap poll, possibly as soon as July. That would benefit the rightist League and its allies, which won recent local elections. But it prolongs the country’s political uncertainty.

Elliott wins partial victory at Telecom Italia

4 May 2018

The US activist succeeded in installing a majority of independent directors on the telco’s board, snatching control from investor Vivendi. Other shareholders will now be more fairly represented. But to keep CEO Amos Genish the directors will have to forget any strategy overhaul.

Time to put Generali’s nest egg to work

4 May 2018

The Italian insurer has stockpiled 1 bln euros of cash by shedding unloved assets. The sale of a German life unit could double that. With a high dividend and plenty of capital, Generali could turn into a predator. Italy or fast-growing Asia may offer some appealing prey.

Enel and Iberdrola’s Brazil war lacks restraint

30 April 2018

The two companies’ rival bids for Eletropaulo have nearly doubled the market value of Brazil’s top utility in a month, to $1.6 billion. The Europeans want to boost their presence in Latin America’s biggest nation. But the deal is too pricey to create much value for the winner.

Breakdown: Telecom Italia’s three-way poker game

23 April 2018

The incumbent telco is entangled in its umpteenth debilitating corporate fight. The row pits U.S. activist investor Paul Singer against French financier Vincent Bolloré. But an Italian state investor may be the key player. Breakingviews explains how the cards will fall.

Intesa offers partial hope for Italy’s dud loans

17 April 2018

The Italian lender is nearing a deal with Swedish group Intrum to shed 10.8 bln euros of dodgy loans from its balance sheet. Domestic peers will be cheered by the price, which is higher than rivals have attained in similar transactions. Then again, Intesa is a better bank.

Review: America’s founding was all about the money

13 April 2018

“New World, Inc.” explores the role of British merchant adventurers in laying the groundwork for the colonial settlements in Virginia and Plymouth. The book is a prequel of sorts to the Pilgrim creation myth that suggests Mammon, not religious freedom, drove America's creation.

Cerberus Alitalia carve-up would not fly with Rome

11 April 2018

The private equity firm is reported to be plotting a three-headed bid for the Italian airline. It would see easyJet take short-haul routes and Air France-KLM long ones, while Cerberus puts up the cash. But a breakup plan will not pass muster with a new nationalist government.

Bolloré’s best bet is to play along with Singer

10 April 2018

Vivendi chair Vincent Bolloré may lose a fight for control of Telecom Italia with activist investor Elliott. Selling his 24 pct stake would mean a loss, assuming he can find a buyer. Staying put while Paul Singer’s group tries to revive the Italian telco is a better option.

Aston Martin can race Ferrari in IPO test

9 April 2018

James Bond’s carmaker is eyeing a listing six years after an emergency pit stop. Rich margins and racy growth make it a close match for the prancing horse, justifying a $7bln valuation, and sixfold return for rescuer Andrea Bonomi. But Ferrari’s scarcity premium could be dented.

Italy’s TIM grab gives investors two messy options

5 April 2018

State investor CDP may buy 5 pct of Telecom Italia. If it sides with Elliott, the activist fund could take control from top shareholder Vivendi. The French group’s oversight of TIM has been dysfunctional. But protectionism coupled with complex ownership is also unappealing.

Berlusconi scores point off Bolloré in mogul feud

3 April 2018

Shares in the former prime minister’s Mediaset TV group jumped after it agreed to collaborate with Sky’s Italian unit. An investor in Mediaset, Vincent Bolloré’s Vivendi will gain from the deal. But, as Berlusconi and Sky grow closer, Bolloré’s own ambitions risk being sidelined.