Banks Shun Mediobanca-Ferrari Plan after IPO Slight

Leading Italian banks on Friday shunned a plan by Mediobanca to buy a stake in Ferrari from struggling Fiat after the investment bank torpedoed their planned share offering for the legendary sportscar maker.

Mediobanca, once the centre of deal-making in Italy, seemed to have recovered some of its lost clout on Thursday when it reached agreement with Fiat to buy a 34 percent stake in Ferrari for just over 775 million euros.

By Friday, however, there was still no sign of who might join a pool Mediobanca wants to create to help pay for the deal, with three of Italy's biggest financial institutions - IntesaBCI, Unicredito and Banca di Roma - already out of the picture.

Mediobanca on Thursday said it had agreed to sell a 12.5 percent stake in Ferrari to "foreign and Italian banks" but declined to identify them.

Financial newspaper Il Sole 24 Ore reported that Germany's Commerzbank, an old ally of Mediobanca, was willing to step in as might small Italian savings banks. But other leading banks ruled themselves out.

"We are not involved in the placement," Intesa CEO Corrado Passera said and the chairman of Banca di Roma, Cesare Geronzi, also said his bank was not interested.

They were among the three banks which put together an emergency credit package worth three billion euros for Fiat last month, in return for promises to cut debts and generate cashflow.

Unicredito, itself a leading shareholder in Mediobanca, also had no intention of joining the pool, a financial source said. Deutsche Bank, which owns more than two percent of Fiat's shares, declined to comment.

The flotation of one of the world's best known brands was originally going to be the prize of Deutsche Bank, UniCredito's brokerage UBM and Intesa who signed up to stage the stock market listing later this year.

Stealthy Move

Even the head of Ferrari appeared put out by Mediobanca's stealthy move on the company. "I only knew about it once the deal was done and I didn't like that," Ferrari Chairman Luca Cordero di Montezemolo told reporters during a presentation of a new car at Ferrari's home base of Maranello, northern Italy.

Fiat shares rose as much as five percent, with traders saying the Ferrari deal and the appointment of a new chief executive were signs that Fiat was moving ahead with its plan to tackle growing losses and debts.

Mediobanca was up one percent, lagging the DJ Stoxx index of European banking shares rose 1.4 percent.

Fiat Chairman Paolo Fresco described the deal with Mediobanca as "win-win" for the cash-strapped carmaker which no longer has to brave an early IPO to get money for its Ferrari stake, and for the Milan investment bank which has now lined itself up to handle the Ferrari listing in the future.

Still, Mediobanca's 2.4 billion euro valuation of Ferrari raised eyebrows among analysts, who said it could be worth as little as half that based on multiples of German rival Porsche.

Mediobanca was the key dealmaker in Italy during the second half of the 20th century.

But its fortunes waned with the death of its founder Enrico Cuccia in 2000 and it was left out of some of the country's most recent takeovers, including a 2001 raid on Telecom Italia and its holding Olivetti.

Once close ties with Fiat also took a hit last year, when the Turin-based group and partners snatched away Mediobanca's most prized asset - industrial holding Montedison.