(Finance) – With the presentation of the 2024 Budget Law, the Minister of Economy Giancarlo Giorgetti outlined the Government’s intention to carry out privatizations equal to 1% of GDP (around 20 billion euros) in the next three years, a step considered important by the Parliamentary Budget Office (PBO) to ensure the convergence of the debt/GDP ratio towards public finance objectives. He remembers it Equity in its outlook for 2024, trying to outline the possible candidates to participate in the privatization programwhich has already started with the sale of 25% of the company through ABB Banca Monte dei Paschi di Siena for a value of approximately 0.9 billion euros.
Excluding for the moment the disposals of state real estateestimated by some sources at over 300 billion euros, the MEF currently holds, directly or through Cassa Depositi e Prestiti, shareholdings in listed companies for over 66.5 billion euros. According to recent press sources, there are currently among the companies affected by privatizations Eni, Italian postState Railways, Rai Way and Rai.
According to Minister Giorgetti “there are several dossiers on privatizations, some like Railways require legislative choices and regulatory adjustmentswhile others like Poste or RaiWay could be easier to manage”. As regards MPS, the Minister is confident that “a solution capable of redefining the banking system in a polycentric perspective could materialize in 2024”.
In detail, Eni is currently accelerating the buy-back plan, potentially paving the way for a reduction in the state’s share of the energy group. Equita expects that the buyback of Eni will bring the State’s overall share above 34%. At current market prices, 4% of Eni is worth around 2 billion euros.
At the same time, the MEF could proceed with the sale of part of its stake in Post office (29.3%), with an income estimated at approximately 3.8 billion euros. According to the newspapers, among the options under consideration there would be the possibility of announcing the sale in conjunction with the new industrial plan of the company scheduled for March 20, 2024, the date on which the FY23 results will be presented, and the company’s dividend policy will probably also be revised upwards.
The market’s attention is also focused on the possible sale of 40% of state Railwayswith an estimated valuation of between 4.5-5 billion euros.
As regards Eni, Equita considers the hypothesis of a placement as a “practicable” scenario, which can “be absorbed by the title without excessive pressure”. For Poste Italiane, considering the size of the offer, it is “probable that the Government will not choose, as it did for MPS, the ABB instrument, but rather apublic offeropen to both institutional and retail investors and employees”.
It should be noted that among other holdings directly owned by the MEF are 53.3%. ENAV (equal to 1 billion euros), 14.1% of STM (5.7 billion euros), 30.2% of Leonardo (2.4 billion euros), 23.6% of Is in the (15.8 billion euros) and 39.2% of MPS (1.6 billion euros).
With regard to ENAVEquita considers a possible sale to be “unlikely” given the nature of the asset and the limited revenue that would possibly be obtained. STM and Leonardo however, they must, in principle, be excluded given the strategic nature of the two shareholdings, together with the practical difficulties in selling the shareholding in STM, held through a JV with the French Government.