Bonds News

REFILE-Shares in Italy's Atlantia fall as government ultimatum looms

(Refiles to add ‘to’, paragraph 3)

ROME, Sept 28 (Reuters) - Shares in Italy’s Atlantia fell 1.4% on Monday, bucking a higher Milan market ahead of a new deadline set by the government for a deal to end a two-year long dispute over the group’s motorway business.

ASPI’s board will meet on Tuesday to discuss how to answer the government’s ultimatum, a source close to the company said.

Rome is ready to revoke the lucrative concession held by the group’s Autostrade per l’Italia (ASPI) unit if Atlantia fails to agree on a deal with the government by Wednesday, a government source said on Sunday.

Rome’s coalition government has been threatening to strip ASPI of its contract to manage 3,000 km (1,850 miles) of Italian toll-roads since a bridge operated by the company collapsed in August 2018 killing 43 people.

Revoking the concession is a complex step that would entangle the parties in a fresh legal war. But they have so far been unable to find a compromise to solve the impasse.

They are still at loggerheads over how to execute a plan agreed in mid-July that would see Atlantia cede control of ASPI to state lender Cassa Depositi e Prestiti (CDP).

“The risk of revocation of the concession, which seemed to be outdated after the mid-July agreements, is now highly relevant again,” broker Fidentiis said.

“At this point it seems clear that Atlantia wants to go its own way and therefore takes the risk of a long legal battle with the government”. (Reporting by Stefano Bernabei in Rome and Giancarlo Navach in Milan, writing by Giulia Segreti; editing by Jason Neely)