Benettons meet over Italian motorway contract ultimatum

Two sources familiar with the matter said the Benettons were ready to lower Atlantia's stake in Autostrade below 50% through a capital increase. Sources have previously said Italy's biggest infrastructure fund F2i and state lender CDP are in talks to split a majority stake in Autostrade, possibly involving Italian co-investors such as Poste Italiane.

The boards of Benetton-backed Atlantia and its motorway business are meeting to discuss measures demanded by the government to save a contract to run most of Italy's highways, a person familiar with the matter said on Friday. Rome has been threatening to revoke the toll road licence held by Atlantia's Autostrade per l'Italia since a bridge it operated in Genoa collapsed in August 2018, killing 43 people.

The anti-establishment 5-Star Movement has led the campaign to remove the licence or get the Benettons to give up control, but its governing partners, the centre-left PD and centrist Italia Viva, worry this would cost billions in compensation. The government wants a solution by the end of the week, after rejecting compromises proposed by Autostrade.

To put a stop to proceedings, Autostrade must submit a new plan detailing steps that include lowering tariffs and paying compensation to meet demands made on Thursday. "At this point either they send in a last-minute offer the government can't say no to... or it's a revocation procedure," Prime Minister Giuseppe Conte said on Friday.

A government source said a cabinet meeting could be called on Monday, although nothing had been fixed. The Benetton family owns 30% of Atlantia which in turns owns 88% of Autostrade, the rest being in the hands of Chinese fund Silk Road and Germany's Allianz.

Rome introduced legislation in December to cut the amount of compensation it would have to pay Autostrade for revoking its license, a move financial sources estimated might reduce the figure to 6-8 billion euros ($6.78-9.04 billion), from 23 billion euros. Two sources familiar with the matter said the Benettons were ready to lower Atlantia's stake in Autostrade below 50% through a capital increase.

Sources have previously said Italy's biggest infrastructure fund F2i and state lender CDP are in talks to split a majority stake in Autostrade, possibly involving Italian co-investors such as Poste Italiane. The sources said infrastructure giant Macquarie was also ready to team up with CDP.

Atlantia, F2i and Macquarie declined to comment. A spokesman for CDP said it had no Autostrade dossier on the table. ($1 = 0.8854 euros)