Fiat eye stake in Corriere publisher

Trading in RCS Mediagroup, the publisher of Italy's best-selling newspaper Corriere della Sera, was suspended on Monday after its price soared on the news that auto giant Fiat could become its biggest shareholder.

Fiat eye stake in Corriere publisher
On Friday Fiat said it is looking to almost double its stake in RCS Mediagroup. Photo: Geoff Robins/AFP

Trading was suspended after the company stock shot up 25.91 percent to €1.73.

On Friday, Fiat said it is looking to almost double its stake in RCS from 10.5 percent to 20.1 percent following a €400 million capital increase which ends July 5th.

The transaction would see Italy's Agnelli family extend its reach into the news business.

Investors hailed the news, which is likely to boost the value of the debt-laden RCS and permit the company to launch a turn-around plan.

Fresh developments regarding the capital hike are expected to come this week, with analysts in particular watching closely to see whether Italian businessman Diego Della Valle, who owns a 8.7 percent stake in the group, will take part.

Fiat chairman John Elkann, who in May joined the board of Rupert Murdoch's News Corp, on Monday refuted Italian media reports of a possible alliance with the Australian-born media baron.

"Today, the objective is to give RCS a structure which allows it to be the great Italian editorial group that it is. Today, the most important thing is guaranteeing stability," Elkann was quoted as saying by Italian media.

RCS will use the fresh capital to offset losses and is laying off employees and selling assets. The company reported a net loss in the first quarter of €107.1 million.

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Fiat promises no job cuts in return for state aid: report

Fiat Chrysler has agreed to the conditions laid down for a state-backed €6.3 billion euro loan, including a promise not to relocate or cut jobs, Italy's Sole 24 Ore daily said Sunday.

Fiat promises no job cuts in return for state aid: report
Robots manufactured by Comau are pictured on the assembly line of the Fiat 500 BEV Battery Electric Vehicle. Photo: AFP

The state auditor has approved the guarantee, but it still needs to be signed off on by the economy ministry, the paper said.

The request for state support on such a large loan has proved controversial, particularly with the company's corporate headquarters in Amsterdam.

FCA — which directly employs close to 55,000 people in Italy — has said the loan is essential to help the group's Italy operations and the whole industry to weather the crisis triggered by the coronavirus pandemic.

The company will commit to investing 5.2 billion euro in Italy on new and existing projects, and up to 1.2 billion euro on its 1,400 or so foreign suppliers, said Sole 24 Ore, Italy's financial newspaper.


FCA will also pledge not to cut any jobs before 2023.

The loan will be funded by Italy's largest commercial bank Intesa San Paolo and 80 percent guaranteed by export credit agency SACE, the daily said.

The government has said FCA would face sanctions if it failed to stick to the conditions laid down for loan. Sole 24 Ore said the fine for breaking the agreement could be in the region of 500 million euros.