Mediobanca closes the 2014-2015 financial year with results "beyond expectations", acquires the London asset manager Caim Capital and looks to its role as investment bank and asset manager in the future government bad bank. On the Stock Exchange, the stock jumps above 2% and then rises to around 1,9%.
The market celebrates revenues for the first time above 2 billion euros (+12%), profits at 590 million (+27%) and a dividend above expectations at 0,25 euros per share (+67% compared to the previous year ) and payouts up to 36% from 27%. These results were mainly driven by the performance of the banking business which compensated for the lower contribution of principal investing.
The results, commented the CEO Alberto Nagel in a conference call "were beyond our expectations".
The investment bank then concluded a strategic partnership for control of 51% of Caim Capital, a London-based asset manager specializing in credit, with the option to acquire the remaining 49% from the third year. “This transaction confirms our strategic focus on building an asset management platform with attractive return on capital prospects and represents a further step in Mediobanca's international development,” Nagel noted. Cairn Capital had $30 billion in assets under management as of June 5,6 and $9,1 billion in long-term advisory mandates.
The closing is expected by the end of the year and no significant impacts are expected on the group's Cet 1 capital ratio. On the acquisitions front, the Banca Esperia dossier is open where Piazzetta Cuccia could rise to 100%. “For Banca Esperia it would be optimal to arrive at a single ownership to extract greater synergies and develop the group in a more robust way. We are a candidate for this unique property, but we are not the only one”. Nagel commented, indicating that discussions with the other shareholder, Mediolanum, are going ahead.
“If possible – he said – we will find an agreement which must be based on an understanding and shared values. So, we will see in the coming months if it is possible to close a transaction. Both of us shareholders are convinced that a single ownership will extract more value from the company”.
YES TO THE CHEMCHINA TENDER OFFER
INTERESTED IN THE DEVELOPMENT OF ITALMOBILIARE
Then there is the shareholding front, from RCS to Pirelli, Generali and Italmobiliare. Mediobanca, which is actively following the development of the dossier, says it is in favor of divestitures and partnerships for the relaunch and refocusing of the publishing group in which it is a shareholder with 6,2%. “There are interesting areas of valorisation of the RCS group's activities, which probably, if concentrated in a smaller number of activities, could have in the future also with partnerships, economic-financial prospects in improvement and therefore we are careful that these prospects are also grasped to better value our share and accompany the company in this process,” said Nagel.
In the meantime Piazzetta Cuccia plans to bring its stake in Pirelli to the tender offer launched by ChemChina, despite the fact that the value of the Pirelli share on the stock market is currently higher than the tender price. "Considering the size of our share, which is approximately 3% - explained Nagel - the contribution to the takeover bid is the natural end of our shareholding rather than selling on the market".
The stake in Italmobiliare, the Pesenti holding company which will end up with a nice nest egg in cash after the sale of the stake in Italcementi to the Germans of Heidelberg Cement, is not being sold, at least for now. On the contrary. Piazzetta Cuccia said she was interested in participating in the development of the holding company.
“Italmobiliare – explained Nagel – has never been a share that we have placed among those being sold, now we will see with ownership, with Carlo Pesenti what will be the face it will design for the new Italamobiliare, knowing that it will have a portfolio and a more interesting, because the Italcementi sale operation was concluded at very interesting values, with a significant stake in the new group. Italmobiliare will also carry out an activity with the assets it will acquire from Italcementi in the renewable energy sector. There may be interesting programs to be developed jointly with the Pesenti group”.
Finally, there was also a new endorsement to Generali by Andrea Greco whose plan, said Nagel, is very interesting and goes in the right direction". The performance of the stock does not worry Mediobanca's management: "The insurance sector – is the explanation – lacks a catalyst that will arrive sooner or later and there will be a re-rating".
BAD BANK, YOU NEED A GOOD COMPROMISE
Mediobanca is interested in the bad bank both as an investment bank and as an asset manager. Nagel specified this when answering analysts during the conference call to present the accounts. “something that we will be watching very carefully both as an investment bank business and as an asset management business, because we are interested in participating. We are supporting the government's efforts to find a good compromise."
“It will be decidedly useful if the Government finds a good compromise with some intermediaries between the need to have an asset management company that buys non-performing loans at reasonable market prices – said Nagel – For now, the gap with market prices is difficult to fill, except by someone other than the State". According to Nagel, the government is "making progress" and it will be seen in the end whether an agreement is found with Brussels.
If the Government is pursuing a "rather good" policy on loan collection and enforcement, the question that Mediobanca is posing today is that of the regulations implementing the laws. "It is important that they are done in reasonable terms - he concluded - otherwise the times for some very interesting reforms take too long to become effective and are perhaps watered down by non-linear implementation".
