MILAN, May 23 (Reuters) - Italy’s market watchdog Consob said it was looking into the price movements of shares in Unipol after they fell sharply on Thursday on the back of developments in an investigation into to the insurer’s merger with Fondiaria-SAI.
Two sources close to the probe said on Thursday Unipol’s CEO Carlo Cimbri had been placed under investigation for alleged market rigging as part of the case. Unipol said it and its managers had acted properly.
Consob said in an emailed statement on Friday it was looking at trading sessions on Thursday and Friday as well as information provided to the market. Unipol shares rose 3.3 percent on Friday, a day after dropping more than 7 percent.
Bologna-based Unipol agreed to buy troubled rival Fondiaria in 2012 in a complex rescue operation that was held up by a series of regulatory and legal hurdles.
The merger created UnipolSai, Italy’s second largest insurance group behind Assicurazioni Generali, and was officially completed on Jan. 6 this year.
Milan prosecutors suspect that Unipol did not accurately account for its large structured derivatives portfolio and that this had an impact on the setting of the share swap ratios for the tie-up with Fondiaria, according to judicial sources.
The police also asked Consob for documents regarding the operation.
Consob said on Friday it had constantly supervised information given to the market while the share swap ratios were being set and that it had conducted an in-dept evaluation of Unipol’s derivatives portfolio, inducing the company to correct its 2011 financial report. (Reporting by Danilo Masoni, editing by David Evans)