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UPDATE 1-Italy aims for planned sale of Enel stake by end-March - sources
February 12, 2015 / 7:43 PM / in 3 years

UPDATE 1-Italy aims for planned sale of Enel stake by end-March - sources

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By Francesca Landini and Stephen Jewkes

MILAN, Feb 12 (Reuters) - Italy is trying to wrap up the planned sale of a 2 billion euro minority stake in top utility Enel by end-March, paving the way for more asset disposals, sources close to the matter said.

The Treasury, which owns 31 percent of Enel, last year said it wanted to sell up to 6 percent of the utility by the end of 2014, but postponed the sale because of choppy financial markets.

Better market conditions in Italy and a period of political stability following the election of a new president last month, have convinced government officials that a sale by the end of March would make sense.

“The Treasury wants to show it can lure foreign investors and pull off a successful deal,” a financial source close to the matter said.

A banking source familiar with Enel said banks had been alerted on the Enel stake sale, adding that when a decision to sell was taken a deal could be done in hours.

The government of Matteo Renzi last year tabled a series of privatisation plans to reduce Italy’s mountain of debt, equivalent to more than 130 percent of gross domestic product last year.

However the plans for a sale in the coming weeks could still be derailed if market conditions worsen due to outside influences ranging from Greece to Ukraine, a third source said.

If markets get rough the Treasury could decide to wait until the end of this year, a third source said.

The Treasury has recently said the final deadline for the sale is the end of this year, adding it would look at the best market conditions to maximise its revenues.

Enel, one of Europe’s most indebted utilities, is due to present its first business plan under CEO Francesco Starace on March 18. Management is expected to focus efforts on debt reduction, growth in emerging markets and renewables.

“It might make sense for investors to wait and see what the new CEO says before stumping up money,” the banker said. (Reporting by Francesca Landini and Stephen Jewkes, editing by James Mackenzie and Elaine Hardcastle)

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