Italy's RCS Mediagroup presses ahead with restructuring plan

Sun Apr 14, 2013 6:57pm EDT
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By Antonella Ciancio

MILAN (Reuters) - The board of Italy's loss-making RCS MediaGroup (RCSM.MI: Quote) approved on Sunday the broad terms of a capital increase and a debt refinancing plan needed for its turnaround plan.

The publisher of Italy's newspaper Il Corriere della Sera, whose ownership groups some of Italy's biggest financial and industrial names, needs large financial resources to accelerate its digital transition and reverse losses over the next three years.

RCS on Sunday reported a group's net loss of 509.3 million euros for 2012, and is seeking shareholders support for a cash call of up to 600 million euro ($786 million) by 2015, with a first tranche of 400 million euros by July.

The controlling group of shareholders includes investment bank Mediobanca (MDBI.MI: Quote), carmaker Fiat FIA.MI, tyre maker Pirelli PECI.MI, Italy's biggest retail bank Intesa Sanpaolo (ISP.MI: Quote) and leading insurer Generali (GASI.MI: Quote).

The group's weak performances and Italy's worsening economy have raised concerns that some shareholders may be reluctant to spend the cash to take up their stake in the capital increase.

As of Friday, pledges from the members of the company's shareholder pact - which includes some of Italy's biggest corporate names and controls a 58 percent stake - had totalled around 44 percent of RCS's capital.

Fiat, Mediobanca and Pirelli, and Fonsai FOSA.MI - another investor with 5.4 percent - have all indicated they will take part in the capital increase.

Several shareholders outside the pact have said they won't take part in the capital hike or are still undecided, raising concerns a sizeable mount of the shares on offer will go unsold.   Continued...