fiat forever


Nuovo Utente
Punti reazioni
Mi pare che la Fiat sia sotto indagine (consob? magistratura?)
per questa storiella.
c'è qualcuno che se la sente di spiegare in poche , povere
parole la tecnica usata?
ah dimenticavo....qualche giornale italiano ha trattato l'argomento?
se qualcuno avesse fretta si legga le ultime 3-4 righe

veramenti istruttive ed edificanti sulla famiglia del grande LCdM
e per finire..comodo tirare in ballo l'economist o il f.t. quando sparlano
di Berlusca....

Italian finance
Still in the driving seat
Oct 13th 2005
From The Economist print edition
How the Agnelli family retained control of Fiat

WHAT a difference a year makes. Twelve months ago Fiat, Italy's largest industrial group, was going from bad to worse. Now, helped largely by a €1.5 billion ($2 billion) divorce settlement in February from General Motors, analysts expect Fiat to record a pre-tax profit of over €1 billion this year. This turnaround follows total pre-tax losses of over €8 billion since 2001. It has made the group more valuable to the Agnelli family, which through a cascade of companies controls IFIL Investments, a quoted company that is in turn Fiat's controlling shareholder.
However, when Fiat announced on April 26th that it would not repay in cash a €3 billion convertible loan from a consortium of banks, it looked as though IFIL might lose control. The banks could convert their loan into Fiat shares on September 20th, giving them 24% of the company and diluting IFIL from 30% to 23%.

Even so, IFIL said in June that it intended to keep control. This created a dilemma. When the banks converted their loans into shares, IFIL might have to buy more shares, probably at a premium, to avoid losing control of Fiat. But if IFIL raised its holding above 30% by buying more shares before September 20th, it would, under Italy's takeover rules, have to bid for the entire firm in cash, a costly undertaking even for the Agnellis.
So when IFIL said on September 15th that it had found a way of avoiding both dilution and a mandatory offer, it seemed to have pulled off an ingenious coup. As the banks converted their loans, IFIL simultaneously acquired sufficient shares to retain control—around 7% of Fiat's voting capital—at €6.50 a share, compared with the market price of €7.30.
The seller was IFIL's sister firm, Exor Group, a private company of which the Agnelli family directly owns 70%. Exor in turn bought the shares on the same day from Merrill Lynch, an American investment bank, at €5.60 a share under an equity swap, a type of derivative. Exor and Merrill had signed the swap on April 26th, the very day Fiat announced the conversion of the banks' loan. In April, Fiat's share price dipped to around €4.50, the lowest for years.
It looked rather opportunistic that the deal made Exor a profit of €74m at IFIL's expense. At the insistence of Consob, Italy's stockmarket regulator, and in response to critical press articles, IFIL has published more details of the transaction. With the benefit of this information, a cynic might suspect that what happened in September had been pre-arranged in April and so should have been disclosed to the market then. So, in solving its dilemma, had the Agnelli family in effect abused the market to the detriment of Fiat's minority shareholders while it, through Exor, made money on the side? Or did it simply find the cheapest way of stabilising the ownership of Fiat, to the benefit of IFIL's shareholders great and small?
Under the swap, Merrill was to buy 90m Fiat ordinary shares by June 7th. It bought them for €495m, an average of €5.50 per share. Merrill was to sell the underlying shares on the swap's expiry in December 2006, or sooner if Exor requested early settlement. If the proceeds exceeded €495m, Merrill would send Exor the surplus in cash, less its funding costs. If they were below €495m, Exor would send Merrill the cash to cover the deficit and the investment bank's funding costs. The swap thus insulated Merrill from any risk relating to Fiat's share price.
The swap could have specified an alternative method of settlement, known as physical delivery. Under this method, Merrill would sell the shares to Exor for €495m plus its funding costs. Equity swaps of this size specifying this form of settlement have to be disclosed to Consob. But those to be settled in cash (derived from the sale of the shares in the swap) do not. So in this case no disclosure to the market was necessary.
From Merrill's point of view, there was no financial difference between settling in cash and physical delivery. But for Exor there was a big difference: it wanted the shares themselves, not cash for the increase in their value over €495m. So on September 15th, the two firms agreed to revise their swap contract to enable Merrill to sell the shares themselves to Exor. But this required disclosure under the law.
Merrill subsequently declared, as it was legally required to do, that its stake in Fiat had crossed the 5% and 10% thresholds on September 15th. However, according to the swap contract, the investment bank was supposed to have bought 90m shares, more than the 5% trigger of Fiat shares, by June 7th. This was more than three months before it disclosed the holding to Consob.
If Merrill held the shares directly, or through derivatives that specified delivery of shares, it should have declared the holding. So it must have executed cash-settlement equity swaps with third parties who agreed to a switch from cash settlement to physical delivery at the same time as Merrill itself did with Exor. Merrill Lynch has not answered our written questions.
Because of spikes during July and August in Fiat's share price and the volume of shares traded, Consob twice asked IFIL if it knew of any reason for the shares' volatility. On both occasions (July 26th and August 24th), IFIL told the market, at Consob's behest, that it did not. Gianluigi Gabetti, the chairman of both IFIL and Exor, has justified IFIL's response on the grounds that Merrill's buying ended on June 7th, some weeks before Consob's first request.
According to Mr Gabetti, the change to the terms of the settlement of the swap was “obviously not anticipated”. On August 24th IFIL told the market, again at Consob's behest, that it had neither “undertaken nor studied any initiative in relation to the expiry of the convertible loan”. IFIL has said that it found the solution implemented on September 20th only after August 25th.
This explanation means the existence of the swap was a felicitous coincidence; so too its mechanics, which left Merrill indifferent to switching from cash settlement to physical delivery. According to Mr Gabetti, the swap was essentially an informed bet that Fiat's share price would go up. Yet the existence of the swap certainly helped IFIL—and the Agnellis—to stay in control. Had Exor terminated the swap, Merrill would have sold the underlying shares on the market, thereby increasing the chances of control of Fiat falling into someone else's hands. While the swap remained open, Exor in effect controlled the underlying shares because Merrill Lynch would not sell them.
It is conceivable that the swap was no more than an informed bet. However, it is more plausible to see it as essential planning for the conversion of the loan in September, and the swap's original cash-settlement terms as an ingenious plan to avoid informing the market. If this is what happened, the losers from the manoeuvre would have been anyone who sold Fiat shares when the shares underlying the swap were being bought. And only those who take IFIL's explanation at face value could then still feel comfortable investing in a quoted company that the Agnelli family controls.
ramirez ha scritto:
Mi pare che la Fiat sia sotto indagine (consob? magistratura?)
per questa storiella.
Strano 'posto' questo forum.
Posto un art. dell'Economist (*)DOVE PRATICAMENTE
(*) Articolo peraltro mai smentito dagli Agnelli
Naturalmente se il caso fosse già stato trattato
nel forum la cosa si potrebbe spiegare, ma sinceramente
non me ne sono accorto....
ok, grazie. Parola turna indrèè (in lombardo : mi rimangio ciò che ho detto)