January 15, 2020 / 10:42 AM / 5 days ago

Italy's Atlantia eyes tariff cuts as pressure grows to pull concession

MILAN/ROME (Reuters) - Benetton-led Atlantia (ATL.MI) is ready to reopen talks with the government on motorway toll cuts, two sources said, as Italy’s biggest infrastructure group seeks to resolve a bitter dispute over its concessions.

FILE PHOTO: A logo of the Atlantia Group is seen outside their headquarters in Rome, Italy August 31, 2018. REUTERS/Alessandro Bianchi/File Photo

Atlantia, which controls highway operator Autostrade per l’Italia, is facing political pressure over a bridge collapse in 2018 that killed 43 people, and it remains to be seen if its offer will satisfy the government.

Leading members of the ruling 5-Star Movement insist that Autostrade should be stripped of its concession, which generates a third of Atlantia’s core profits and is a main pillar of its business.

“Atlantia is ready to discuss the idea of cutting motorway tariffs,” a financial source familiar with the matter told Reuters, adding this was a signal to the government to end the year-and-a-half long dispute.

Atlantia officials were not immediately available for comment.

Autostrade will hold a board meeting on Thursday to discuss a new business plan to 2023, two people with knowledge of the matter said on Wednesday.

The company, which has already taken measures to improve safety controls on its more than 3,000 kms (1,864 miles) of network in Italy, is expected to announce more improvements when it unveils its business plan.

Atlantia’s own board is scheduled to meet on Friday and will discuss the motorway concessions, two other sources said.

HOT TOPIC

5-Star’s hand has been strengthened by prosecutors who have opened four investigations into Autostrade, saying there is evidence that it failed to carry out necessary maintenance on various tunnels and bridges.

Autostrade per l’Italia has always denied any wrongdoing, saying the company has spent more than required on the network.

5-Star leader Luigi Di Maio vowed in a television interview with public broadcaster RAI on Tuesday that the government would withdraw Austostrade’s concession, adding that the ruling parties would meet on the matter “in the next few days.”

Some in the centre-left Democratic Party (PD), which governs with 5-Star, have been more cautious, fearing a legal battle and potentially heavy compensation costs for the state.

They have argued instead that the terms of the concession should be renegotiated, but Autostrade has so far shown no willingness to consider this.

“There is still room for a solution to avoid revoking the licence,” a PD junior minister told Reuters, asking not to be identified. “But we need a clear signal from the Benettons that they are willing to cut tariffs and discuss compensation” for the collapse of Genoa’s Morandi bridge.

Earlier this month Transport Minister Paola De Micheli, from the PD, called a reported offer by Autostrade to cut its toll fees by 700 million euros “insufficient”.

WAITING FOR PM CONTE

Another prominent PD lawmaker told Reuters his party was waiting for Prime Minister Giuseppe Conte to present a report on Autostrade, and if that showed the company’s road upkeep had been inadequate, the PD would not oppose revoking its licence.

A senior 5-Star official said compromise was impossible.

“There’s no more time for talking, we have to withdraw the concession,” he told Reuters, asking not to be identified.

Sources with knowledge of the matter say Autostrade and the government held private talks over tariffs and investments in maintenance until November, when they were broken off.

Il Messaggero daily on Wednesday cited the chairman of the Benetton family holding company Edizione, controlling shareholder of Atlantia, as saying that Atlantia was willing to talk with government-backed infrastructure fund F2i about joining forces on infrastructure management.

Additional reporting by Gavin Jones, Giuseppe Fonte, Stefano Bernabei in Rome; Editing by Emelia Sithole-Matarise, Peter Graff and Lisa Shumaker

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