Fondo Strategico Italiano Takes Stake in Valvitalia

The Fondo Strategico Italiano (FSI) closed 2013 by taking a 49.5% stake in Valvitalia, a designer, producer and supplier of equipment and components for water, natural gas and petroleum companies for €151 (US$ 207.4 million).

The deal represents the fourth of the year and is included in €2.6 billion the strategic fund has invested since January 2012. The FSI has €4.4 billion in assets under management.

According to a statement, investment in 2014 “is expected to be intense.” The sovereign fund cites two major developments on the horizon. The first is the creation of the Italian tourism group, a hotel management company that will be open to institutional investors and will focus on hotels in the 3-5 star range.

According to the release, “This project will benefit from Group synergies, thanks to the Cassa Depositi e Prestiti program of acquisitions and re‐qualification of public real estate.”

The second development is €500 million earmarked for use in consolidating utility companies in Southern Italy. The utility sector is highly fragmented and, presumably, inefficient. The sovereign fund expects consolidation should lead to increased customer service.

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