August 3, 2018 / 9:40 AM / 4 months ago

Elliott stake report lifts Italy's Mediobanca shares

MILAN/LONDON (Reuters) - A report that activist fund Elliott has built a stake of around 1 percent in Mediobanca (MDBI.MI) lifted shares in the influential Italian investment bank on Friday.

The U.S. hedge fund, which is stepping up its activities in Europe as it sees more opportunities to unlock value for shareholders, declined to comment on the report in Italian newspaper La Repubblica, which cited two financial sources.

It said the hedge fund was interested in the idea of Mediobanca spinning off the stake of more than 13 percent it owns in Italy’s top insurer Generali (GASI.MI) and shaking up governance at the bank.

Mediobanca shares were up 2.7 percent at 0902 GMT, while Europe’s banking index .SX7P was up 0.4 percent.

Analysts have said a sale of the Generali stake could reduce the discount at which Mediobanca trades to its net asset value.

A source close to Mediobanca said there had been no contact with Elliott, although it was ready to talk to any investor.

Mediobanca has traditionally been at the heart of Italy’s business community thanks to a portfolio of stakes in top companies which in recent years it has started to dismantle.

“This will be interesting to watch as Mediobanca is extremely well-placed to fend for itself. I don’t think they’ll get shaken very easily,” said a London hedge fund manager.

Vincent Bollore, top investor at French media giant Vivendi (VIV.PA), is Mediobanca’s second-biggest shareholder.

Earlier this year Elliott wrestled board control at Telecom Italia (TLIT.MI) from Vivendi after a two-month campaign to shake up the way it had run the phone group.

Reporting by Paola Arosio and Maiya Keidan, writing by Stephen Jewkes; editing by Alexander Smith

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