Da DAW JONES 14-2-2007. Consumer Grp Blasts Agnelli-Led Holding For Share Swap

14 Feb 2007 14:19 GMT DJ Italy Consumer Grp Blasts Agnelli-Led Holding For Share Swap MILAN (Dow Jones)--The Italian business community's defense of the actions of IFIL Investments SpA (IFL.MI) after it was fined a landmark EUR16 million for a 2005 share swap, is "shocking," a consumer group said Wednesday. IFIL is the holding through which the Agnelli family controls automotive maker Fiat SpA (F.MI). The EUR16 million fine is the largest ever issued by Italian stock market regulator Consob, which has in the past been criticized as lenient. "The statements from managers and bankers in defense of IFIL's share swap - which was an illegal transaction that has been penalized by Consob (the Italian market regulator) - are astonishing and shocking," said Adusbef Chairman Elio Lannutti in a statement. Adusbef is a consumer advocacy group focusing on business and financial issues. Fiat Chief Executive Sergio Marchionne and IFIL Chairman Gianluigi Gabetti had justified the 2005 deal by saying it helped the family keep control of Fiat at a time when the automaker was struggling, Italian papers reported Wednesday. Adusbef called the justifications "Machiavellian." "The 'end' - namely to save Fiat, justifies the 'means,' and it doesn't matter that investors, small shareholders and the credibility of Italy's financial markets pay the price," said Lannutti. IFIL Tuesday said Consob fined Agnelli companies and managers a total of EUR16 million over a disputed Fiat share deal between Agnelli-controlled business in 2005. Turin-based IFIL said the transaction, which allowed it to shore up its control of Fiat at a price below the then-current market rate, broke no rules and added it will appeal to a Turin court. Consob, for its part, said the deal was not properly disclosed to the market. Adusbef said Italian press coverage of the landmark fine Wednesday had acted as a "smoke screen" for IFIL management, noting the company was defended by "a circle of friends." Fiat is "an important shareholder of a large chunk of Italy's mass media," Adusbef said. Corriere della Sera, for example, didn't mention Fiat owned 10% of the Milan daily's parent company, RCS Mediagroup SpA (RCS.MI), in its coverage Wednesday. Nor did the paper report that Gabetti received "extraordinary compensation" of EUR15 million in 2005, according to IFIL's 2005 accounts, for having helped turn Fiat around. He received a further EUR5 million from another Agnelli company the same year, bringing the total to EUR20 million. Reports in Italy's other main dailies were similar. -By Jennifer Clark, Dow Jones Newswires; 39 02 58 21 99 04; jennifer.clark@dowjones.com (END) Dow Jones Newswires February 14, 2007 09:19 ET (14:19 GMT) Copyright (c) 2007 Dow Jones & Company, Inc.

14/02/2007

Documento n.6431