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Fiat Group has finally sold its
small stake in Italian banking concern Mediobanca it was announced this morning,
a non-core investment that the Italian carmaker has been seeking to divest
itself of for sometime. The sale to Goldman Sachs, which will be settled next
week, will raise Fiat around 118 million euros.
Fiat issued a brief statement in
Turin earlier this morning: "Fiat sold its 1,83% equity stake in Mediobanca
S.p.A. to Goldman Sachs International, realising a gain of approximately € 118
million," read the press release. "Settlement is expected to occur on 26
September 2007. Goldman Sachs International will place the shares with
institutional investors," the statement concluded.
Share in Fiat rose nearly 3 percent
to 19.84 euros this morning. European automotive shares were up across the board
as Goldman Sachs raised the automotive industry from 'neutral' to 'attractive'
in a report published this morning. The investment bank lifted its target price
for Fiat from 26 to 30 euros and with a 'buy' recommendation. It also suggested
Renault as another carmaker with strong potential for a share price increase.
Mediobanca meanwhile dropped slightly in early trading, losing 0.46 pct to 14.99
euros a share, after the news was released that Fiat had sold its 1.83 pct stake
to Goldman Sachs.
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Earlier this decade the bank was chosen to lead a
consortium to purchase a minority stake in the
Ferrari sports car division, pending an IPO,
although his route was subsequently discarded.
Photo: Ferrari 430 Scuderia at the Frankfurt Motor
Show on the occasion of its world debut. |
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Fiat has finally sold its small stake in Italian
bank Mediobanca it was announced this morning, an
investment that it has been looking to divest itself
of for sometime. Photo: Fiat is making an impact at
the Frankfurt Motor Show this week with a full
range. |
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Mediobanca was set up straight after World War II, on the initiative first of
Banca Commerciale Italiana (BCI, now Banca Intesa), then Credito Italiano (now
UniCredito Italiano) and Banco di Roma (soon to be part of the group known first
as Banca di Roma, then Capitalia). Mediobanca has long had a very close
relationship with Fiat, holding stakes in the leading Italian carmaker ever
since the early 1970s. Earlier this decade the bank was chosen to lead a
consortium to purchase a minority stake in the Ferrari sports car division,
pending an IPO. This route was subsequently discarded by Fiat which recently
re-purchased almost all the stake through a buy-back clause it held.
The third largest bank in Italy
today, Mediobanca has a market capital of almost 15 billion euros. Recent
restructuring has seen its performance increasing significantly: its market cap.
was 6 billion euros in 2003. Fiat's CEO Sergio Marchionne has long been looking
at exiting this non-strategic investment as he divests the Turinese firm of its
non-core activities.
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