VR Leasing has scrapped plans for a joint venture with Banca
Italease, casting another shadow over the future of the already
troubled Italian company.
The German lessor had to obtain formal approval from its parent
company, Frankfurt-based DZ Group, by the end of November. But
Italease’s board of directors was informed at the last minute that
VR Leasing would no longer set up the planned joint venture. The
two companies had been in talks throughout 2008.
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VR Leasing’s decision had not been predicted by its Italian
counterpart.
Italease chairman Lino Benassi said: “Because of the already
advanced state of procedures to reach the definitive agreement, the
intensity of activities done by both work groups and no new
relevant events concerning Banca Italease, the decision from DZ
Bank Group was unexpected.”
Benassi added that the reason behind VR’s scrapping of the deal
was “presumably” due to current market uncertainties.
This view was echoed by VR chairman Reinhard Gödel. He said
despite satisfactory results of due diligence, there would be no
joint venture because of the difficult market environment.
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By GlobalData“We have come to the conclusion that a joint venture currently
cannot be put into practice,” Gödel added.
The planned partnership would have concerned core leasing
activities of Banca Italease. The German lessor had agreed to
acquire a 60 percent stake for €369 million with the option to
subsequently buy the remaining 40 percent.
Right after the announcement, Italease’s shares plunged,
impacting its main shareholder Banco Popolare. But the Italian
lessor, which has suffered from failed derivative contracts it
entered into in 2007, and has seen some of its former heads
recently brought to trial, has responded quickly to its latest
setback.
Last month it said it intends targeting “modest” growth, and
will study “with interest” plans by the Italian government to give
banks between €10 billion and €12 billion to strengthen their
capital ratios by underwriting their debt.
According to informed sources, it would also create a “bad bank”
to manage its problematic assets.
Banca Italease’s main shareholders have confirmed they will
extend €2 billion in new credit lines. Italease intends using this
credit to finance small and medium-sized company customers of the
banks that make up its shareholding. The bank aims to end next year
with liquidity of around €500 million.
Italease’s main shareholders are Banco Popolare, with a 30.7
percent share, Banca Popolare Emilia Romagna, with around 7
percent, Societa’ Reale Mutua di Assicurazioni, Banca Popolare di
Sondrio and Banca Popolare di Milano.
