MILAN, March 31 (Class Editori) — The Chinese Group FAW is ready to make an offer for Iveco's trucks and FTP's engines. According to Bloomberg, the due diligence is about to come to an end: once the inspection of factories will be concluded, FAW could offer more than 3.5 billion euros to acquire the two subsidiaries of CNH Industrial. According to financial circles, the bid should be made by June to the BoD guided by Scott Wine, who will then have to judge if the sale of FTP and Iveco to the Chinese Group could be a better option than the already-planned spin-off. The market seems to push towards the first alternative: yesterday, CHN Industrial's share price was up 4.3% to 13.5 euros thus resulting in the best stock on Piazza Affari, the Milan Stock Exchange.
Despite the excitement of investors, the negotiation is not uncomplicated. First of all, FAW's acquisition is jeopardized by the golden power already evokedon several occasions by Giancarlo Giorgetti, the Italian Minister of Economic Development. To avoid this possibility, the Chinse Group would have not included in its offer the military business of Iveco, but this could not be enough to allay the fear of the Government regarding the sale of a strategic company with more than 20,000 employees.
Negotiations between FAW and CNH Industrial are also carefully monitored by France. Annonay is home to an important Iveco Bus plant, the fate of which is close to the heart of the Parisian Government that is notoriously inclined to make national interest prevail even in negotiations between private parties.
Italian and French interests in the Iveco affair could be defined at European level: in fact, the EU Commission will have to pronounce on the possible sale. In recent months, the EU Antitrust Authority has announced stricter control over acquisitions in Europe by non-EU state-controlled groups, such as FAW, which is 100% in the hands of Beijing. Brussels' fear, which is shared by many EU industrial players and governments, is that the availability of public funds may allow off-market offers, distorting competition among operators.
For now, however, these speculations can be examined only when FAW's offer for Iveco arrives and if CNH Industrial's Board of Directors accepts it. The CEO Wine has recently confirmed that the work for the spin-off is going on, while clarifying that any purchase proposal will be evaluated. Much will depend on the orientations of Exor (reference partner of CNH Industrial), which seems increasingly distant from the automotive world. After the sale of Magneti Marelli from FCA to Calsonic and the one, at least from the accounting point of view, of Fiat Chrysler to Peugeot through Stellantis, the transfer of Iveco to FAW would be Exor's third sale in the automotive sector in two years, to which we could soon add the spin-off of Comau, although its modalities still have to be defined.
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