Medium and Large Italian Corporates Prep for SACE Guarantee Bank Loans

Posted on 05/09/2020

In April 2020, the Italian government approved a series of fiscal emergency measures which entailed liquidity and bank loans for companies impacted by the coronavirus (COVID-19). The Italian government permitted medium-sized and large companies to request Servizi Assicurativi del Commercio Estero (SACE) to guarantee new bank loans. One of the stipulations includes firms taking the loans to not approve dividends for a year. The aid is being granted by SACE, through banks, to companies impacted by the viral outbreak. SACE disclosed the it received 250 requests for state-guaranteed loans so far, including a unit from Atlantia SpA. On April 14, 2020, the European Commission approved the Italian aid scheme to support the economy in the context of the coronavirus outbreak. The total budget of the measure communicated by the Italian authorities is of up to €200 billion.

The coronavirus has killed more than 30,000 people in Italy.

Atlantia is an Italian holding company with operations in the infrastructure sector, including motorways, airport infrastructure, and transport services. The company aims to give around 1,000 euros worth of shares to each of the 12,000 workers employed by the group’s Italian companies, the motorway and airport operator. In a bid to help the country’s workforce during the viral outbreak, the 75-share grant will be deposited in a securities escrow account for a period of three years, after which the employee will have full title to the shares. The scheme still needs shareholder approval, which is set for a vote on May 29, 2020.

In 2019, Atlantia was criticized for executive bonuses paid out even in the event of the August 2018 motorway bridge asset it operating in Genoa, which ended up killing 43 people. At December 31, 2019, some of the largest shareholders of Atlantia are Singapore’s GIC Private Limited at 8.29%, Sintonia (Edizione) at 30.25%, Lazard Asset Management at 5.05%, HSBC Holdings Plc at 5.01%, and Fondazione Cassa di Risparmio di Torino at 4.85%.

On another note, Fiat Chrysler are in talks with Intesa Sanpaolo over a €6.3 billion state-guaranteed loan. If approved by Intesa Sanpaolo, the loan request will be reviewed by SACE, through which the state provides its guarantee. Fiat Chrysler slowly restarted its operations in Italy since the end of April 2020.

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