March 10, 2020 / 4:48 PM / 20 days ago

Atlantia shares touch multi-year lows as virus worries grow

MILAN, March 10 (Reuters) - Shares in Italy’s Atlantia hit their lowest in more than six years on Tuesday as concern about a fall in traffic following the coronavirus outbreak and a jump in bond yields deepened the impact of a long-standing feud with Rome.

Atlantia, which is controlled by the Benetton family, runs more than half of Italy’s highway network through Autostrade per l’Italia and operates Rome’s airports with its ADR unit.

The government has repeatedly threatened to strip Atlantia of its motorway concession after a motorway bridge operated by Autostrade collapsed in August 2018, killing 43 people.

In recent days, the coronavirus outbreak in Italy has increased pressure on the group, analysts said.

“There are several causes for the drastic fall in the stock,” Marco Opipari, analyst at broker Fidentiis, said, citing the virus impact on traffic, uncertainty over the group’s motorway concession, a jump in yields, and a fall in value of Atlantia’s assets in Latin America.

Shares in Atlantia fell to 14.35 euros at 1550 GMT, their lowest since September 2013 and the group’s notes were also hit.

The group has a total debt of 38 billion euros ($43 billion), which includes 8 billion euros in bonds issued by Autostrade and more than 5 billion euros in notes issued by Atlantia.

A bond issued by the group and due on February 2025 traded at 87.84 on Tuesday with a yield of 4.44% according to Refinitiv data. Last week the same bond was trading at around 97, with a yield of 2.20%.

On Monday the Italian government placed the whole of Italy under lockdown until next month to try to beat the coronavirus in Europe’s worst-affected country.

Italian flagship carrier Alitalia, whose hub is Rome’s Fiumicino airport, had to cut domestic and international flights because of the government curbs and restrictions on flights and passengers from Italy.

At the same time, an informal proposal sent by the company to the government several weeks ago to find a compromise over Autostrade’s concession has yet to receive an answer.

Italian financial daily Il Sole 24 Ore reported the government refused the idea, mooted by some investment banks, of reducing Atlantia’s stake in Autostrade to make room for infrastructure fund F2i.

“I hope the group can reach a deal with the transport ministry in May or June, but I am not yet that sure,” a source close to the matter told Reuters, speaking on condition of anonymity.

$1 = 0.8824 euros Additional reporting by Stephen Jewkes; editing by Barbara Lewis

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