November 13, 2019 / 2:55 PM / 25 days ago

Italy's Salini looking to wrap up Astaldi deal in first half of 2020

MILAN (Reuters) - Salini Impregilo (SALI.MI) expects to wrap up the acquisition of smaller building rival Astaldi (AST.MI) early next year as it pushes ahead with plans to create a domestic construction champion, the group’s general manager said on Wednesday.

“We are also looking round for contracts and assets of other smaller Italian rivals to include in the project,” Massimo Ferrari told Reuters.

Italy’s biggest construction company has made itself the cornerstone of a state-backed plan dubbed ‘Project Italy’ to revive the country’s ailing construction industry by aggregating other players.

The acquisition of Astaldi, currently under a Chapter 11-like credit protection scheme, is a key part of the project.

Two of Astaldi’s court-appointed commissioners, along with others, are being probed for alleged corruption, according to a prosecutor’s document seen by Reuters.

However Ferrari said he did not believe the investigation would hamper the deal. “I don’t think the legal probe will slow down the process and we expect to close the deal in the first half of 2020,” he said.

Astaldi issued a statement on Tuesday saying it had learned about the investigation from press reports and was continuing its work.

Many smaller Italian builders are saddled with crippling debts and thousands have gone broke over the past decade.

Rome, which is looking to infrastructure development to help lift the economy, is keen to create a player strong enough to compete at home and abroad.

Ferrari said Salini Impregilo was looking at tapping the bond market to refinance debt.

“We want to take advantage of good debt market conditions and the recent capital increase,” he said, adding a decision would be taken very soon.

On Tuesday, Salini Impregilo completed a 600 million euro ($661 million) cash call designed to fund Project Italy, some 225 million euros earmarked for acquiring a majority in Astaldi.

The cash call diluted the stake of family holding Salini Costruttori to around 45%, from around 75%, while state lender Cassa Depositi e Prestiti entered with close to 19%.

Billionaire Leonardo Del Vecchio and activist fund Elliott also bought stakes. Ferrari declined to say how much the two investors had bought.

Salini Impregilo is due to release 9-month results later on Wednesday. Ferrari said it had orders of around 7 billion euros, mostly in the United States and Australia.

($1 = 0.9074 euros)

Reporting by Stephen Jewkes; editing by James Mackenzie

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below