Italy says plans to sell stake in power grid Terna

ROME/MILAN Fri Oct 18, 2013 12:01pm EDT

Italian Prime Minister Enrico Letta speaks at the Brookings Institute in Washington October 17, 2013. REUTERS/Joshua Roberts

Italian Prime Minister Enrico Letta speaks at the Brookings Institute in Washington October 17, 2013.

Credit: Reuters/Joshua Roberts

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ROME/MILAN (Reuters) - Italy plans to sell stakes in power grid operator Terna (TRN.MI) and state-owned shipyard Fincantieri, the government said in a statement issued late on Friday following confusion over the scale of government divestments.

The statement from the office of Prime Minister Enrico Letta said the government would make a final decision before the end of the year but said the amount to be offered had not been decided.

The statement followed comments by Letta in an interview with the Washington Post in which he was quoted as saying the government would sell 49 percent of Terna.

Terna has a market value of 7.2 billion euros.

"We will sell one part of Terna, which is the national electric grid. Of course, not 100 percent, but 49 percent," Letta was quoted as saying.

A government source later said Letta was misquoted and meant to say the government would sell 4.9 percent of Terna.

A second source confirmed this.

The government, via state-controlled lender Cassa Depositi e Prestiti, owns 29.9 percent of the power grid operator, which is regarded as a strategic asset.

Italy is aiming to sell assets to help bring down its debt mountain which currently stands at 133 percent of gross domestic product (GDP).

On Thursday Economy Minister Fabrizio Saccomanni said the state should begin to sell its assets, including real estate and companies, as soon as possible.

Letta has previously said the government will sell public buildings and stakes in companies worth a total of 0.5 pct of GDP per year.

"As far as Terna is concerned (a 4.9 percent) stake is very small and makes little difference. It's business as usual for the company," a Milan-based utility analyst said.

Its shares, which fell around 2 percent earlier in the day, were down 0.34 percent at the close, in line with the European utility index .SX6P.

(Reporting by Giselda Vagnoni and Stephen Jewkes, additional reporting by Gavin Jones; Editing by David Cowell)

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