October 25, 2020

The Benettons will leave Autostrade after a tough political battle and twenty years of control


Rome

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After a soap opera that has lasted almost two years, Italy ends a battle over “Autostrade per l’Italia” (ASPI), whose political rather than economic background. After 20 years of control, the Benetton family will end, in the time span of about a year, outside the management of Autostrade per l’Italia and the other companies that are part of the Atlantia group (under its control is 88% of Aspi), a partner of ACS in Abertis, which manages 3,257 kilometers of motorways in Italy, out of a total of 5,866, that is, 55.3 %. In a decision of the Cabinet, which ended at dawn, at 5:16, the Government of Conte will withdraw the concession to Benetton and Austostrade per l’Italia will be a public company, controlled by the State.

The Benettons could continue to hold a very minority stake, but in practice their power would be almost nil and marginal over the long term. The state Deposit and Loan Fund, controlled by the Ministry of Economy and which manages the savings of a large part of the Italians, will have the majority capital of the ASPI company (51%), which will be public and publicly traded, of the that had come out in 2003.

Atlantia, which in negotiations with the government was not willing to reduce its share in Autostrade’s capital by more than 34%, has ended up offering its availability to transfer their entire participation (88%) to institutional investors that are to their liking. It also agrees to pay compensation of 3.4 billion euros for the Morandi bridge catastrophe and a reduction in motorway fees.

Conte: “Out with the Benettons”

Prime Minister Giuseppe Conte had told the Il Fatto Quotidiano newspaper, close to the 5-Star Movement, on Monday that the “Austostrade per l’Italia” concession would be “revoked”: “The Benettons are kidding us. The State cannot be a partner of those who tease the families of the victims. Conte was referring to the 43 people who died on August 14, 2018, after the collapse of the Morandi bridge in Genoa, managed by Atlantia, valued at around 10,000 million euros, a group that the Benetton family controls by 30%.

In Italy, it is not recalled that a prime minister had made such a forceful statement against one of the most powerful groups in the country, such as the Benetton family. Since the catastrophe of the Morandi bridge, a hard battle began, with great political background, with the government threatening to revoke the concession to Autostrade per l’Italia. The 5 Star Movement (M5E) made this battle a mark of its identity. Propaganda played a fundamental role. The country was shocked by the death of 43 people in the collapse of the Genoa bridge. The grillinos blamed Atlantia and the Benetton family for neglecting child support and worrying above all about the financial benefits.

Battle between populism and realism

For almost two years, the fight was between realism and populism. For the M5E there was only one way out: revocation. This would have meant the bankruptcy of society, unemployment for its 7,000 workers, which was of great concern to the unions, and compensation by the State: the Government offered 7,000 million and Atlantia demanded 23,000 million. The threat of revocation was already causing significant financial damage to Atlantia and other private companies involved in the management: a slump in the Stock Market and economic losses with the degradation of the obligations issued by Autostrade to finance, among other projects, the reconstruction of the Morandi bridge in Genoa, already completed and will be officially opened in early August.

In short, revoking the concession to Autostrade would have led to bankruptcy in the short term, which would have cost an estimated more than 19,000 million euros, which would have weighed heavily on the entire Italian system and on its external image. And, in the long term, after a complicated and difficult process, it would probably have forced the State to pay compensation surely close to the 23 billion that Autostrade required.

Revocation and lengthy court battle avoided

In the end, realism has prevailed and a compromise solution is reached. There has been no revocation and a long and hard legal battle has been avoided, as well as a probable greater political instability in these already dramatic moments that the country is experiencing due to the coronavirus. Various political leaders, including the head of state, Sergio Mattarella, although he has not done so publicly, intervened to prevent the economic and social catastrophe that would have resulted in the revocation of the concession. The final commitment is that the Benettons yield to the conditions imposed by the Conte government, giving up future legal battles. Conte comes out stronger and the 5 Star Movement sings victory: «Bye bye Benetton. It is a historic day for Italians, “say the” grillinos “in a tweet. The stock exchange rewards this principle of agreement: Atlantia rises 24%.

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