Finmeccanica rises on sale prospects

Finmeccanica rises on sale prospects
By Euronews

Finmeccanica was boosted on Monday in Milan by a new offer on its energy unit.

The Italian defense systems specialist was up more than 5% at the close, the biggest winner on the Milan exchange. An Italian public fund has made an offer for 55% of Ansaldo Energia, which Finmeccanica wants to sell.

The Italian company posted record losses last year. It is reorganising its businesses and intends to sell 1 billion euros worth of non-defense assets by the end of the year in order to reduce its huge debt.

The merger project of EADS and Britain’s BAE Systems makes its restructuring all the more urgent. The birth of a European defense giant could threaten its share of important markets outside Italy, namely the UK and the US. According to analysts, its best chance of survival would be a combination with other collateral victims of this megafusion, like its French partner Thales. But to do so, Finmeccanica needs first to improve its balance sheet.

The announcement of a possible merger of EADS and BAE made Finmeccanica’s share price plunge by more than 5% on the 13th of September. Since then, as obstacles to the project seem to multiply, it has reduced its losses to 1.8%.

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