Italy

Italian construction company Salini Impregilo said on Thursday it had presented a non-binding expression of interest for Astaldi, which has filed for creditor protection, Reuters reported. Astaldi, one of Italy’s leading contractors with more than 10,500 employees, filed for court protection in September after delays to the sale of its 33.3 percent stake in the Third Bosphorus Bridge in Turkey. Last month sources told Reuters that Salini was working with Bank of America Merrill Lynch and Vitale & Co on options for a possible full or partial takeover of Astaldi.

Italy’s government debt sold off sharply on Wednesday with the benchmark 10-year yield rising to a three-week high after the country’s government told the European Commission that it would forge ahead with its fiscally aggressive budget, the Financial Times reported. The yield on the 10-year bond hit a session high of 3.547 per cent, an increase of 9.8 basis points, after Italy’s populist coalition government defied calls from Europe to reverse its plans to sharply increase public spending.

Food group Barilla said on Wednesday it had presented an offer to buy the second-largest pasta plant in Italy from domestic rival Pasta Zara to boost its production capacity, Reuters reported. Family-owned Pasta Zara has started court proceedings to get creditor protection after its debt spiralled out of control. The factory, which is located near Tieste, in northern Italy, can produce up to 280,000 tonnes of pasta a year, according to one source close to the matter. “The factory ...

Why is Italy’s economy so sickly and has the country’s new government found the cure for its economic ills? As Rome locks horns with Brussels over a draft Italian budget that the European Commission has rejected for breaching EU rules, the Financial Times has consulted leading economists, academics and industrialists about the root causes of the country’s sluggish growth, the Financial Times reported.

Italy’s fiscal stimulus plans would leave the country vulnerable to higher interest rates that could ultimately plunge it into recession, the International Monetary Fund warned on Tuesday, recommending instead a “modest” fiscal consolidation to reduce financing costs, Reuters reported. The IMF said after an annual staff review of Italy’s economic policies that any temporary, near-term growth gains from the stimulus is likely to be outweighed by the “substantial risk” of a rapid deterioration.

Italy's insolvent bank du jour, Banca Carige which was halted on Monday due to events profiled earlier has gotten a last minute lifeline, and after it was unable to raise €400MM in capital in the bond market, it received a €320MM liquidity injection from Italy's Interbank fund, which plans to purchase €320m of Carige bonds, ZeroHedge reported.

Italy was quick to rebuff the European Commission’s latest criticism of its budget, accusing it of sloppy and outdated analysis, Bloomberg News reported. Shortly after the European Commission published its latest forecasts for Italy, most of which were more pessimistic than the government’s, Finance Minister Giovanni Tria said the numbers come from an “inadequate and partial analysis.” He added that the EU ignored “clarifications provided by Italy.” Rome’s unusually strong response included another refusal to change its budget targets, despite demands from the EU.

UniCredit SpA Chief Executive Officer Jean-Pierre Mustier’s turnaround plans hit a last-minute hurdle after the bank cut key targets and took a charge related to its Turkish bank, Bloomberg News reported. The lender surprised investors with an 850 million-euro ($972 million) charge to revalue Istanbul-based Yapi Kredi Bankasi AS and said it’s increasing funds to cover a potential settlement related to U.S. sanctions over Iran. The Milan-based bank also lowered targets for revenue and a key measure of financial strength this year and next, while keeping its 2019 profit target intact.

The state appointed commissioners running Alitalia will complete their examination of the proposals received for the sale of the company next week, a source close to the matter told Reuters on Thursday. The commissioners for the Italian carrier said last week they had received two binding offers and one non-binding expression of interest, but gave no details of the bids, Reuters reported.

Italian business executives are sounding the alarm. The composite purchasing managers’ index that tracks both services and manufacturing sectors in the Italian economy fell to 49.3 in October, the lowest reading since November 2013 and below the 50 mark that separates growth from contraction, the Financial Times reported. Data published last week had already pointed to the first contraction in the manufacturing sector since 2016. But on Tuesday, fresh data showed the services sector had followed suit, dragging the composite indicator with it.