ADVERTISEMENT

Italy Pushes Benettons on Autostrade Deal After New Arrests

Italy Pushes Benettons to Take Autostrade Deal After New Arrests

The Italian government is ratcheting up pressure on the Benetton family’s Atlantia SpA to close a deal to sell a majority stake in its toll-road unit following the arrest of some former managers on Wednesday.

Atlantia’s Autostrade per l’Italia SpA could again face a costly legal battle over a possible revocation of its concessions -- an option that had been off the table -- according to government officials, who asked not to be named discussing confidential deliberations.

Italy Pushes Benettons on Autostrade Deal After New Arrests

Giovanni Castellucci, who built Autostrade over two decades before resigning last year, is under house arrest along with two other former managers, while other measures were taken on three current company executives. All of them were targeted in a probe related to a deadly 2018 bridge collapse in Genoa.

Castellucci and the other managers have been charged with fraud and putting the safety of transportation in danger, according to a police statement. Prosecutors argue the managers were aware of deficiencies in highway barriers. Autostrade claims the barrier issue was resolved in 2019.

The new investigation is unrelated to the Genoa accident, attorneys for Castellucci said in a statement, noting that he has not had contact with Autostrade for more than a year. The ongoing investigation will demonstrate that the former executive did not commit any wrongdoing, the statement said.

The Five Star Movement, the biggest party in Prime Minister Giuseppe Conte’s governing coalition, has campaigned for over two years to punish Atlantia for the accident, calling for the Autostrade unit to be stripped of its licenses to run highways in the country. Coalition ally the Democratic Party, or PD, has taken a more moderate tack, backing talks to reach a compromise. But following the arrests, the PD may be running out of patience.

“Time is up, this is clear to us and I hope to them as well,” Francesco Boccia, minister for regional affairs and a member of the PD, said Wednesday on Rai state television. If the two sides can’t reach a deal quickly, “we’ll revoke,” he said.

Operating Profit

The arrests and a return to wrangling over a potential revocation could complicate what’s been a painstaking, months-long negotiation process over the fate of Atlantia’s 88% stake in the highway unit. Rome has pressed the billionaire Benettons to sell the holding to an investor group led by state lender Cassa Depositi e Prestiti SpA. At stake: more than 2 billion euros ($2.4 billion) in operating profit every year generated by the concessions.

Atlantia last month rejected a second bid from Cassa Depositi and funds Macquarie Group Ltd. and Blackstone Group Inc. which valued the stake at between 8.5 billion euros and 9.5 billion euros, excluding legal claims. Talks are continuing in a bid to reach agreement on a binding offer by a Nov. 30 deadline.

Shielding the buyers from claims linked to the bridge collapse has been one of the thorniest issues in the talks and the new probe, which could go on for years, adds uncertainty over the value of legal risks.

Atlantia shares fell as much as 2.8% in Milan on Thursday, and were down 0.5% at 12:21 p.m. local time. The stock is down about 28% so far this year.

©2020 Bloomberg L.P.