Do you know how many consultants are paid for the privatization of Ita Airways?

15 April 20222 years ago babelfish

Advice for the future strategic alliance went to Mediobanca and Jp Morgan for the financial part, while for the legal part Ita Airways will be assisted by Sullivan & Cromwell and Grande Stevens. But the Treasury also recruits its advisors (Equita, for the financial part, and Gianni & Origoni for the legal)

Many (too many?) Consultants for the privatization of Ita Airways, the newco that took over from Alitalia last October.

On January 31, the company deployed JPMorgan and Mediobanca for the financial side and Grande Stevens and Sullivan & Cromwell for the legal aspects to help it search for private investors.

“Ita Airways will pay up to 8 million 900 thousand euros to the four consultants (and advisors) who should help it in the search for a buyer. And less than two months later, on March 24, the Ministry of Economy recruits its advisors (Equita, for the financial part, and Gianni & Origoni for the legal) ”, Repubblica writes today.

Last week, the Treasury invited interested parties to submit expressions of interest in the carrier by April 18, according to Reuters and Il Sole 24 Ore .

According to Repubblica , “it will be the advisors of the Economy, 100% owner of Ita, who will dominate the privatization scene and take charge of the expressions of interest for the company. This is the clear and precise will that Minister Daniele Franco expressed in a letter. So the four advisors of the subsidiary Ita will have to carve out a role that needs to be specified ".

Meanwhile, 6 of the company's 9 board members resigned at the end of March. The chairman Alfredo Altavilla, CEO Fabio Lazzerini and a member of the aviation sector remained on the board.

All the details.

THE PROPOSALS ON THE TABLE

"The consultants invited various aviation players to formalize their interest in Ita," reported Reuters .

On the table are the proposals of the MSC-Lufthansa consortium, "the proposal of the American fund Indigo Partners which manages various low cost airlines in the world, the letter from the US Certares fund (which advances the commercial partnership with Air France-KLM and Delta Air Lines ) ”Summarizes the Courier .

THE REMUNERATION OF THE CONSULTANTS CHOSEN BY THE MANAGEMENT OF ITA AIRWAYS

Therefore, following the operation there will be six consultants: the two selected by the Mef and the four selected by the company's management.

According to Repubblica , it is “legitimate to ask whether the activities that they will be able to carry out in the shadow of the two ministerial consultants justify an expenditure of up to 8.9 million for Ita. Moreover, in the context of an already fragile economic balance ”.

The two law firms are recruited with "direct assignment". The newspaper reports that “Grande Stevens will receive 550 thousand euros as a fixed remuneration; and another 2 million 150 thousand euros if the sale of the carrier is successful ".

“The other law firm – Sullivan & Cromwell – instead gets a fee of 1050 euros for every hour of engagement of its professionals, especially experienced lawyers. At the end of the consultation, hour after hour, Sullivan & Cromwell will receive up to a maximum of 2.7 million. If these legal consultants enter the game with "direct reliance", Ita identifies the financial ones with a "competitive selection" that initially focuses on seven business banks, national and international. Among the seven, Ita bets decided on JP Morgan and Mediobanca who will receive – each – 1.75 million. The sum, also in this case, will be paid as long as the privatization goes through ”reports Repubblica .

SUBBUGLI IN THE BOARD

On January 31st the Ita Aiways Board of Directors approved the legal and financial consultancy assignments. And "the executives of Ita assure that they have snatched significant discounts from the four consultants" always underlines Repubblica . But something in the definition of assignments and duties must have upset the board of directors of the company.

On March 24, the ministry puts its two consultants and advisors on track. The following week, six directors of the board of Ita resigned. “Some of the resigned, with their farewell, disavow the resolution that hired the four consultants on January 31st. When they learned of the arrival of the ministry's advisors, some Ita advisors would have asked Grande Stevens, Sullivan & Cromwell, JP Morgan and Mediobanca to be revoked ”reports Repubblica .

At Ansa some sources "underline that the expenses for the advisors have nothing to do with it, explaining that this second phase requires a start and a more streamlined trend that must be managed by the company more quickly". Meanwhile, parliamentarians are also questioning the matter. “The resignation of two thirds of the members must lead to the forfeiture of the board and the appointment of an adequate management. Are the competent parliamentary committees watching? The Government must come to the hearing in Parliament ”, declared the deputy Leu, Stefano Fassina in a statement.

This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/smartcity/ita-airways-consulenti-privatizzazione/ on Thu, 14 Apr 2022 13:51:41 +0000.