Shearman & Sterling is acting as US counsel to Fondiaria-SAI S.p.A. (FonSAI) in connection with its €1.1 billion rights issue. Barclays, Credit Suisse, Deutsche Bank, Mediobanca, Nomura, UBS Investment Bank and UniCredit Bank AG, Milan Branch are acting as joint global coordinators and Banca Akros, Banca Aletti, Banca Carige and Centrobanca are acting as co-lead managers on this transaction. With this offering, the Italian offices of Shearman & Sterling have advised on all three of the major recapitalization transactions that have been launched by Italian financial institutions in recent months.
FonSAI, which is the second-largest insurance group in Italy, is offering 916,895,448 new ordinary shares and 321,762,672 new Category B savings shares pursuant to transferable pre-emptive subscription rights granted to existing holders of ordinary shares and Category A savings shares. The FonSAI rights offering is being undertaken as part of the remediation plan imposed by ISVAP (the regulatory authority for the Italian insurance industry) to address the persistent shortfalls in the solvency margin of FonSAI.
This transaction, which is expected to close during August 2012, is part of a complex series of restructuring and recapitalization transactions that will transform the Italian insurance industry, culminating with a proposed four-way merger among three companies listed on the Borsa Italiana, the Italian stock exchange— FonSAI, Premafin S.p.A. (the controlling shareholder of FonSAI) and Milano Assicurazioni S.p.A. (a leading Italian insurance company that is controlled by FonSAI) – and Unipol Assicurazioni S.p.A. (an unlisted subsidiary of Unipol Gruppo Finanziario S.p.A.), which is the third-largest insurance group in Italy.
The Shearman & Sterling team was led by partner Michael Bosco (Rome-Capital Markets) with support from Tobia Croff (Milan-Capital Markets) and Craig Gibian (Washington, DC-Tax). Other lawyers involved in this transaction included senior associate Emanuele Trucco (Milan-Capital Markets), associates Giovanni Cirelli (Rome-Capital Markets), Marco Barbi (Milan-Capital Markets), and Judy Fisher (San Francisco-Tax) and trainees Gaetano Petroni (Milan-Capital Markets) and Alberto Cozzi (Milan-Capital Markets).
