Why Canzonieri (formerly Mediobanca) is wrong about mergers
The post by Fulvio Coltorti, former director of Mediobanca's studies and research area
From Sole 24 Ore, a new hymn to mergers.
I believe that before speaking it is good to realize what is being said. Italy is making a great recovery, certainly not due to large mergers, with Stellantis expert in layoffs and large banks collapsed into two, perhaps three, poles that have already eliminated competition.
As shown by our trade balances with foreign countries, which have long been active for 90/100 billion euros a year, it is the goods produced by smaller companies that prevail on foreign markets. These companies are by no means under capitalized and have withstood the pandemic crisis well, often taking advantage of it. On the other hand, many companies resulting from mergers and acquisitions often present themselves without any assets, having distributed or employed in goodwill that are worth zero in real terms.
On the other hand, an intermediary is a pied piper who always goes in search of commissions and the more operations he promotes, the more he earns.
It is unfortunately a music dear to the ears of the Bank of Italy , but creating new major players in the banking sector means creating protected companies which would only repeat the atrocities that have led us to the great financial crises of recent years. We must not create national champions (which by definition must be protected for life), but facilitate the autonomous development of the best companies we have and these are certainly not the ones that have ensured commissions and rich bonuses to intermediaries in the recent past.
This does not mean that private equity is useless, but that it is good to use it intelligently by supporting the companies that have proven to be the most deserving, without causing new damage.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/perche-canzonieri-ex-mediobanca-sbaglia-sulle-fusioni/ on Wed, 07 Jul 2021 09:01:21 +0000.