The verdicts of the rating agencies, companies full of conflicts of interest and often with little foresight, must always be taken with a grain of salt. But the downgrading of Finmeccanica decided in the last few days by Moody's and preceded by that of Standard & Poor's and Fitch, which brought the rating of the Italian group to the first junk level (partially speculative title), is more than an alarm bell. The reasons speak for themselves: Moody's acknowledges that, under the leadership of CEO Alessandro Pansa (now paired with chairman Gianni De Gennaro), Finmeccanica has made progress in relaunching operations but reports with concern the delays in the disposals of Ansaldo Energia and Ansaldo Sts and above all the black hole of AnsaldoBreda.
Pansa, who comes from finance but who by now knows Finmeccanica's advanced technology manufacturing industry inside out, knows these things very well and is determined to do them. But we are in Italy and overcoming political, local and trade union resistance is difficult (although Finmeccanica has inaugurated a new model of industrial relations which has recently borne fruit in the Selex dispute, where 2.500 redundancies were managed by consensus without an hour's strike). Now for Ansaldo Energia – despite the surges of the Genoese, partly counterbalanced in recent days by signs of reasonableness that have surfaced in the major local newspaper – the games are practically done and, sooner or later, they should lead to the entry into the capital of the Koreans of Doosen.
For Ansaldo STS, a company listed on the Stock Exchange and a true technological jewel leader in the High Speed sector, the talks for the sale to Hitachi or, more likely to General Electric, have been open for some time. We are sorry to sell STS but let us remember two facts: 1) Ge is the multinational that has to its credit the valorisation of the Nuovo Pignone, the Florentine company that everyone feared would be colonized and which instead experienced a powerful relaunch when Eni, which was no longer able to support it, gave it to the Americans; 2) Ansaldo STS is already now outside Finmeccanica's core business, which risks holding back its development due to the need to concentrate on defence, security and aerospace.
Ma the real critical point of Finmeccanica is AnsaldoBreda, whose difficulties, not by chance, are considered decisive by Moody's. AnsaldoBreda produces trams, subways, regional and high-speed trains in four sites (Pistoia, Naples, Reggio Calabria and Palermo) with presence also in Spain and the USA, employs 2.250 people and has a long industrial history. Her technological skills are not discussed but her evident difficulty in keeping up in the face of increasingly aggressive international competition which has caused her huge losses in recent years. Despite the efforts of the new management, the corporate reorganization under way is not enough to guarantee AnsaldoBreda that recovery of efficiency and competitiveness which alone would restore and make sustainable the balance of the company's accounts, which today is far from approaching.
At the state AnsaldoBreda has at least six handicaps which seriously affect its future: 1) the fragmentation of production on 4 factories too distant from each other; 2) the excess of capacity and manpower modulated on currently chimerical production volumes; 3) the low productivity of direct labour; 4) the excess of administrative personnel; 5) the fragmentation of the supplier base; 6) the absence of stable orders from the national customer and consequently the absence of a consolidated catalog of products.
In such a situation, AnsaldoBreda does not have a secure future if it remains as it is. Its salvation and valorisation are outside the Finmeccanica perimeter and possibly in a combination of divestments that link it to Ansaldo STS. If it will stay alive and if it will have the time to present the new privatization plan it would be time for the Government to strike a blow also on second-level public holdings and, in the case in question, free the field from the obstacles which hold back the full relaunch of Finmeccanica and which impede the exit of energy and transport from its range of action. If it sells well, privatizations not only serve to raise cash but also to send a signal to the financial markets that Italy is not always in plaster and above all to guarantee a better future for companies that can be valued but in a different competitive context. New Pinion teaches.
