Italy Antitrust Regulator Suspends Unipol-Premafin Merger; Launches Probe

Italy's antitrust regulator said Thursday it has suspended a merger between Unipol Gruppo Finanziaria SpA (UNI.MI) and the parent of Italian insurer Fondiaria-SAI SpA (FSA.MI), and has launched an investigation into the merger process.

In a statement, the Italian antitrust authority said the merger risks "the creation of a dominant position in the various markets of the insurance sector," and also risks eliminating or reducing competition in a substantial way.

Under the deal, Unipol would take a controlling stake in Fondiaria-SAI's parent, Premafin Finanziaria SpA Holding di Partecipazioni (PF.MI), and would then participate in a capital increase by Fondiaria-SAI to take control of it, too.

Ultimately, Unipol would fold Premafin, Fondiaria-SAI and a small subsidiary called Milano Assicurazioni SpA (MI.MI) into itself to create a single insurance company that would rival Assicurazioni Generali SpA (G.MI), Italy's largest insurer by premiums.

The regulator said the probe will be concluded in 45 days and will include key players Generali and Mediobanca SpA(MB.MI).

Italian bank Mediobanca has the biggest exposure to Fondiaria-SAI of about EUR1 billion.

-By Giada Zampano, Dow Jones Newswires; +39 06 6976 6920; giada.zampano@dowjones.com

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