Watch out for infrastructure risks

It is not just the banking sector that is at risk; the infrastructure sector is too. This is a sign of the Italian market’s vitality, but also sends a message regarding the country’s economic policy. Trevi, a company from Romagna founded by Davide Trevisani and specialising in large-scale foundations and ground stabilisation, was overwhelmed by debt ten years ago; following the family’s exit, it is now controlled by CDP, which holds a 21 per cent stake, and by international funds. It is now the subject of a bidding war between Webuild, Italy’s leading contractor in major projects with a turnover exceeding 13 billion, and Icop, a Friuli-based engineering firm specialising in microtunnelling and foundations, controlled by the Petrucco family, which has a turnover of 500 million euros.

The latter launched a public takeover bid for Trevi in June, involving a share swap with no cash. Last month, Webuild countered with an all-cash bid of 295 million euros, which received the green light from Consob the day before yesterday. Thus began a bidding war that seems a foregone conclusion. Shares in the company led by Pietro Salini immediately rose by 5.5 per cent, but according to analysts at Kepler Cheuvreux, both companies have the financial scope to improve their respective offers. Icop aims to create a specialised group capable of competing internationally. For Webuild, the aim is to consolidate growth that began in 2013 with the acquisition of Impregilo through a takeover bid. It is now a multinational and aims to integrate specialist expertise through Trevi, with estimated overall economic benefits of 150–160 million euros. The board of directors of the Romagna-based company has rejected Icop’s takeover bid, deeming its 273 million euros offer financially inadequate; however, the main objections relate precisely to the industrial synergies, which are considered difficult to quantify. Regardless of the outcome, the market competition is to be commended. If Webuild prevails, will there be loud outcries over excessive concentration that reduces competition? In reality, its size remains small compared to international giants, even European ones, and this is a sector where scale and a broad range of expertise are crucial. In any case, competition is safeguarded by boosting demand for infrastructure and construction, starting with the domestic market. And this is the implicit, yet clear, message for Italian politicians.