Italy is fast becoming one of Europe’s most popular countries for UAE-based investors. With the rise of joint conferences between the two territories – including the Italy-UAE Business Forum – as well as both agreeing to work together on the World Expo (this year’s Expo Milano as well as Expo Dubai 2020), it’s no secret that the two governments have been working hard to increase business. In fact, according to the UAE Ministry of Economy, Italy is now the UAE’s second-largest trading partner in Europe.
Figures released by the ministry reveal that non-oil trade between Italy and the UAE stood at just over $6 billion, and in an interview with Gulf News last July, Giorgio Starace, Italian Ambassador to the UAE, confirmed that export trade from Italy to UAE was worth $5.9 million, while the UAE sent products worth $534 million to Italy.
So can you guess in which Italian companies the AUE has a stake? We round-up the investments.
Alitalia
Late last year, Etihad Airways completed a transaction of a 49 per cent shareholding in Italian carrier Alitalia. The deal is worth $414 million, according to a statement released by the Abu Dhabi carrier. This total investment includes $120 million to acquire a 75 per cent interest in Alitalia Loyalty Spa, as well as five pairs of slots at London’s Heathrow Airport – which will be leased to Alitalia – valued at $64 million.
At the time of the announcement, James Hogan, President and CEO of Etihad Airways, said: “For Etihad Airways, this is a strategic, long-term commercial investment. With the right level of capitalisation and a strong, strategic business plan, we have confidence the airline can be turned around and repositioned as a premium global airline once again.
“As we revitalise the brand, the airline will increasingly embody all that we recognise as quintessentially Italian – the history, culture, food and fashion. It must be an airline of which Italians can be proud. However, ultimately it has to work as a business and the goal is for sustainable profitability from 2017.”
Damas
Dubai-based, family-owned jewellery group Damas has invested in a number of Italian jewellers since the early 2000s. These include Stefan Hafner, Io Si, Roberta Porrati and La Nouvelle Bague.
Industria Aeronautica
Abu Dhabi’s Mubadala Aerospace is a big part of the bigger Mubabala group, and its Al Ain-based manufacturing company Strata works with everyone from Boeing to Airbus. In 2014, Strata began outsourcing manufacture of its ATR vertical fin and rudder programmes to Italy’s Industria Aeronautica.
The eight-year contract – said to be worth around $120 million – is set to deliver 90 shipments a year to the final assembly line of the ATR aircraft in Toulouse.
Piaggio Aerospace
Last year, Mubadala became the majority shareholder in Piaggio Aerospace, the Italian manufacturer of the fast turboprop the Avanti II and the Hammerhead UAS. Although the Abu Dhabi-based investment and development company has been a shareholder in Piaggio Aero since 2006, it only became the majority stakeholder by buying out the shares held by India’s Tata in early 2014. As of now, Mubadala holds 98.05 per cent of the share capital, with Piero Ferrari – on behalf of the Ferrari family – holding the remaining 1.95 per cent.
UniCredit
In 2012, Aabar Investments became the biggest shareholder in the Italian bank UniCredit after it boosted its stake in the lender to 6.5 per cent. The Abu Dhabi government-owned investment company originally acquired a 4.99 per cent stake for $2.3 billion in Italy’s biggest bank by assets in 2010.
Aabar chairman Khadem Al Qubaisi confirmed to Reuters recently that it had sold the five- and seven-year bonds representing around 4 per cent of UniCredit’s issued and outstanding shares, and while it may issue similar bonds linked to shares in other investments in future, it currently has no plans to do so.
Aeroporti di Roma
Italian media has in the past reported that Atlantia, the company that operates Aeroporti di Roma, is in discussions with a number of investors from the Arabian Gulf for a potential stake sale. And during a joint press conference by Alitalia and Etihad Airways in January, Silvano Cassano, the Italian carrier’s CEO, said he welcomed a potential acquisition of a stake by an Abu Dhabi investment fund.
“We are perfectly aware of the ongoing discussions between Abu Dhabi Investment Authority [ADIA] and Aeroporti di Roma. ADIA is a suitable stakeholder to be involved in these discussions,” he told media. “We welcome any investment from ADIA in Aeroporti di Roma, but of course we consider ourselves spectators.”
Watch this space.
Calabria
In March, it was announced that the Italian region of Calabria is hoping to attract investments from the UAE via the project United Arab Emirates for Internationalisation and Investment Attraction.
Launched by the Italian government in conjunction with the Italian Industry and Commerce Office in the UAE, it is hoping to attract UAE investors in the sectors of oil and gas, agro food, jewellery, home and furniture.
Calabria is particularly famous for cured meats; honey sourced from orange blossoms; chestnuts; strawberry and Eucalyptus trees. The oil of the Bergamot tree, meanwhile, is widely used in cosmetics and perfumes, as well as pharmaceuticals and antibacterial products.
