Meloni makes Caltagirone happy with the Capitals bill. Word of the Financial Times
What does the Financial Times write about the Capitals bill defended by Meloni in the press conference. The matches in Generali and Mediobanca, the role of Caltagirone and beyond
“An alarm would have spread among some companies and shareholders that the legislation” of the Capital Bill “instead of liberalizing and increasing investments in Italy, could do the opposite”. This is what the Financial Times claims, in an article published on the website of the City's financial newspaper, in the “Inside business” section.
“The measures should stimulate the Italian economy and stop the flight of local companies to competing EU locations, in particular the Netherlands. They should also directly benefit from the government's privatization program, expected to raise 20 billion euros over the next three years,” we read in the Ft . “The most recent amendments – claims Patrick Jenkins, deputy editor of the London financial newspaper – have given it a protectionist twist, serving the interests of Meloni's allies and potentially discouraging international investments. Among the most egregious amendments is a rule that would give an extreme incentive to hold shares for 10 years or more, giving such investors 10 times more voting rights than short-term shareholders. While the provision would theoretically apply to any investor, in fact it favors certain types of Italian shareholders – typically family-controlled entities seeking to maintain control of companies, as well as local foundation types that have been long-term, albeit often politicized, shareholders. , of Italian banks". For Jenkins of the Ft, "the most obvious beneficiary of the amended bill is Francesco Gaetano Caltagirone" and "if the law were to be approved as proposed, it would represent a second step backwards for Italian markets in a few months", according to the hosted opinion from the financial economic newspaper.
The capital bill, with the changes approved by the Senate, favors Caltagirone and all the prime minister's allies. The provision "seems positive", but in reality it has a "protectionist" approach, potentially "discouraging for international investments", is essentially the comment entitled How Meloni's new capital bill could turn against Italian companies . Therefore the Financial Times dismantles the thesis of the prime minister, Giorgia Meloni , according to which the bill gives more powers to shareholders without putting the management of the companies at risk, as the Prime Minister underlined during the last press conference.
During the press conference at the end of the year, Meloni explained that he did not believe the reading according to which the capital bill "risks driving away investments and making some large groups ungovernable" is "correct". Meloni's response was addressed – according to the interpretation of Milano Finanza – "to the CEO of Generali, Philippe Donnet , who raised doubts about the rule for the renewal of the board of directors and feared the risk of ungovernability of the companies".
The rule on the methods of presentation of the list of boards of directors «serves to limit the mechanism by which the boards of directors are perpetuated indefinitely regardless of the shareholders. The market likes a forecast that strengthens the weight of shareholders", specified Meloni, underlining that "I see in it a rule that allows investments to be brought closer to something that has not always worked in the past".
But without beating around the bush, the City newspaper claims that «the most obvious beneficiary» of the capital bill – as amended – is Francesco Gaetano Caltagirone, «the octogenarian baron of construction and the media, and significant shareholder of two of the most powerful Italian financial services groups, Assicurazioni Generali and Mediobanca . He and his allies (including Leonardo Del Vecchio, ed.) were thwarted in their attempts to impose new boards of directors at both companies. Caltagirone is also a fundamental ally for Meloni: it owns influential newspapers in the regions where the prime minister has the greatest consensus." If the law were to pass as proposed, the newspaper continues, it would represent "a second step backwards for Italian markets in the space of a few months", after the misstep made by the government in August with the "chaotic" announcement on the intention to impose a tax on the banks' extra profits. Then resolved with the possibility of banks not paying the tax by allocating an amount equal to 2.5 times the tax to the reserve.
But what is the crux of the dispute that pits a part of finance in Italy and in particular, in the cases of Generali and Mediobanca, the partners Caltagirone and Delfin with the top management of Generali and Mediobanca?
Today it is the outgoing board of directors itself that proposes its successors to the shareholders' meeting. With the new rules, the list of the board of directors must be proposed with the favorable vote of two thirds of the directors (the only case of a qualified majority in the voting of the board of directors, apart from the veto right of minorities on issues relating to related parties), it must contain a number of candidates equal to the number of candidates equal to the number to be elected plus one third. “This is a very dissuasive system for the use of council lists, especially thanks to the rule which gives greater space on the board of directors to minority lists in the event that the council list is the most voted”, noted the expert journalist finance, Camilla Conti, in the newspaper La Verità: “The capital bill provides for the proportional distribution of seats on the council based on the votes received. If a minority list gets 20% of the votes it is entitled to 20% of the seats, today the winner takes all even if it has a few votes of difference compared to the list that came second). As for the super bonus for minorities (49% of the positions on the board of directors for the list that receives more than 20% of the votes in the assembly) initially foreseen, it has given way to softer parameters: the minority list that receives more than 20% of the votes votes will be awarded to a number of places defined by the proportional method. However, it is not clear how this proportionality will be given. And for a shareholder fund this is a crucial detail for choosing the field in which to play by calibrating the strategy on the hypothetical margin that could change the balance in governance at the end of the game. If progressivity stops at 33% it's one thing, if it allows you to almost reach the 49% threshold it's another."
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/meloni-fa-felice-caltagirone-col-ddl-capitali-parola-del-financial-times/ on Mon, 08 Jan 2024 15:26:30 +0000.