Italy’s stock exchange represents 33.9% of GDP, in France itis 121% of GDP, in Germany 61%, in the US about 140%. The bulk of Italy’s US$ 2.1 trillion economy and investment opportunities reside into SMEs (Small to Medium Enterprises) that contributes to 76% of employment and 64% of value added vs. an OECD average of 68% and 59%, respectively.
Banca d’Italia, Italy’s central bank, has revised upwards its 2023 forecasts for the Italian economy: it now expects a 0.6% GDP increase, while confirming the estimate of an increase of 1.2% for 2024 and 2025. The Governor of Bank of Italy, Mr. Ignazio Visco, suggested that the European Cent Bank should “communicate better … its messages are too harsh”. He also said that Italy’s economy will be able to handle the rise in interest rates.
On the international front, Italy continues to diversify its natural gas sourcing away from Russia. Italy’s Prime Minister, Ms Giorgia Meloni, in fact, on January 24 presented the "Mattei Plan" for Africa -- named after oil producer ENI’s founder Enrico Mattei-- to Algerian President Abdelmadjid Tabboune. The goal is to create in Italy a natural gas hub for Europe. Eni and Sonatrach signed two memorandums of understanding in Algiers. The first for the enhancement of the energy interconnection network between Italy and Algeria, and the second for a technology cooperation on hydrogen. During the bilateral meeting telecommunications, tourism, agri-food, biomedical and pharmaceuticals were also discussed.
Furthermore, Next Generation EU funds are driving investments in infrastructures to records high. In 2022 US$ 90 billion were up for tender. The Italian Railways, Gruppo Ferrovie dello Stato, leads with US$ 22 billion.
Lastly on Italy’s investment opportunities. The sovereign wealth funds — Adia, the Abu Dhabi Investment Authority, Qatar Investment Authority and Gic, the sovereign investment fund of the Government of Singapore — open the dossier of TeamSystem group, active in the development of software for companies and professionals. According to Il Sole 24 Ore — daily business news paper— minority investment in the company, currently controlled by private equity firm Hellman & Friedman (H&F), is under consideration.
Evercore is the advisor.
Based on recent comparable transactions, TeamSystem could be worth 18 to 20 times its forecasted profits for a total enterprise value of US$ 6.5 billion.
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NEWEST Editorial, January 26 2023
