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M&A activity between France and Italy worth €154 bn in 20 years but the French are now playing the predators

by Andrea Franceschi

The deal between eyewear groups Luxottica and Essilor is just the latest example. The mergers and acquisitions market between Italy and France in recent years has seen, in the large part of cases, the French take on the role of predator and the Italians that of prey.

From 1996 to today, French companies have made acquisitions in Italy worth €101.5 billion, according to Dealogic on M&A operations between the two countries in the last 20 years. That number is almost double what Italian companies have invested in France over the same period of time: €52.5 billion.

The total value of the mergers and acquisitions market between the two countries has surpassed €154 billion but the distribution has not been equal, because of a trend that started with the economic crisis.

Until 2005 in fact it was the Italians who were ahead. Adding together the values from 1997 until 2005, Italian acquisitions in France amounted to €20 billion compared to the €13 billion of the French in Italy. From 2006, (the year of the BNL-BNP and Cariparma-Agricole deals) and above all after the outbreak of the crisis the trend has reversed and French investors have increasingly played the role of conqueror.

Within this trend, Italy is the land of conquest for foreign investors. In particular French investors. From the two banks BNL and Cariparma, sold in 2006 to BNP and Credit Agricole for €10.9 billion and €4.7 billion respectively, to the Edison-Edf (€6.3 billion) and Parmalat- Lactalis (€1 billion) deals of 2011, to more recent operations such as UniCredit's selling of Pioneer to Amundi for €4 billion, the list of big Italian companies that have ended up in foreign hands is long.

Recently the French media company Vivendi’s stake-building in Mediaset and Telecom has been in the news. The group controlled by French businessman Vincent Bolloré has 28.8% and 23.9% of the two companies respectively. That is a portfolio that at current market prices is worth €4.3 billion. The figure makes it the third biggest French investor in Milan's stock market, behind Bpce (€5.3 billion) and Lactalis (€4.9 billion).

Based on an assessment that Sole 24 Ore-ItalyEurope24 carried out using the S&P Capital IQ database, today the total value of shareholdings of companies listed on the Italian Stock Exchange in Milan that are owned by French investors is about €37 billion. That figure is equal to about 7% of the total capitalization of the Milan market.

The strong French presence in Piazza Affari does not have a corresponding Italian presence in Paris. The total value of stake holdings held by Italians in the French bourse is about €19.6 billion, which is just a scrap (0.9%) of the capitalization of the Paris market.


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