Italy - Factors to watch on September 20

Fri Sep 20, 2013 2:55am EDT

The following factors could affect Italian markets on Friday.

Reuters has not verified the newspaper reports, and cannot vouch for their accuracy. New items are marked with (*).

POLITICS

Italy's centre-right leader Silvio Berlusconi called on Thursday for political stability but demanded that Prime Minister Enrico Letta's fragile coalition keep promises to cut taxes, despite growing pressure on public finances.

ECONOMY

Italy's government will slash its forecasts for economic growth and raise its projections for the fiscal deficit and public debt when it issues new forecasts on Friday, according to officials and leaked documents.

Italy's coalition government on Thursday unveiled measures aimed at luring foreign capital back to Italy, but the political instability in the country led some to question whether the plan could be put into effect.

Italy has up to 5.5 billion euros ($7.45 billion) in a sinking fund that the Treasury plans to use by the end of the year to repay debt at maturity or for buybacks, the head of debt at the Treasury said on Thursday.

COMPANIES

TELECOM ITALIA

Telecom Italia Chairman Franco Bernabe and core shareholders failed in hastily-convened talks on Thursday to bridge differences on how to relaunch the debt-laden group ahead of a board meeting early next month.

* Core shareholders Mediobanca and Intesa Sanpaolo are working on a plan that would focus Telecom's business on fixed-line telephony while selling its mobile unit TIM and its Brazil operations, Il Messaggero said. Spain's Telefonica could be paid off partly with Brazilan assets and partly with cash.

* Several newspapers cited the head of infrastructure fund F2i Vito Gamberale as telling a parliamentary hearing that F2i could confer its fibre optic operations Metroweb to Telecom Italia.

FINMECCANICA

Rating agency Moody's Investors Service cut Italian defence and aerospace group Finmeccanica to 'junk,' saying the company was improving at a slower-than-expected pace, and after extensive delays in planned sales worth 1 billion euros.

* If talks with foreign buyers of Finmeccanica assets Ansaldo Energia and AnsaldoBreda are unable to close, state lender CDP could buy stakes in the two units, MF said.

SAVE

Italian airport operator Save said on Thursday it had agreed to sell 50 percent of its food services unit Airest to Lagardere Services as part of a partnership deal to develop its brands globally.

Several newspapers cited the chairman of lender Banca Popolare di Vicenza as saying the bank had 8.26 percent of Save, but excluding any further share acquisitions.

* ALITALIA

A pact exists between Air France and Abu Dhabi's Etihad to save the troubled Alitalia, two newspapers said. The Alitalia CEO could fly to Abu Dhabi in the next few days to meet Etihad management to get a letter of intent to buy a stake in the Italian flagship carrier, Il Giornale said citing unnamed sources. La Repubblica cited rumours saying the pact would see Air France leading operations while Etihad would inject financing.

ITALIAN INDEPENDENT

The sunglass company founded by the grandson of the late Fiat patriarch Gianni Agnelli reported a 54 percent rise in earnings before interests, tax, depreciations and ammortisation (EBITDA) in the first half of this year.

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