Eni Won’t Spin Off Saipem Regardless of Knight Vinke Request

Eni Spa (ENI) has no plans to spin off oil services company Saipem SpA (SPM) regardless of pressure from shareholder Eric Knight, Eni Chairman Giuseppe Recchi said.

Correspondence between Knight and Eni on the issue was part of normal relations with shareholders, Recchi told reporters at a conference today in Cernobbio, Italy. “We pay attention to what our shareholders say,” he said.

Knight, founder of the Knight Vinke fund, which owns less than 1 percent of Italy’s biggest oil company, wrote a letter to Eni Chief Executive Officer Paolo Scaroni last week saying a spinoff of Saipem would be beneficial. The contents of the letter were reported by Italian newspaper Il Sole 24 Ore.

Knight argued that Eni should free itself from Saipem, whose shares have fallen more than 30 percent since the end of January when reports emerged that the company may be the subject of an enquiry. Scaroni and several managers were put under investigation Feb. 7 as part of a probe into the award of oil- services contracts to Saipem in Algeria. The company has denied any wrongdoing.

Separately, Recchi declined to comment on whether the company was in talks with China National Petroleum Corp. for a stake in a gas project in Mozambique.

-- Editors: Alex Devine, Tony Barrett

To contact the reporters on this story: Alessandra Migliaccio in Rome at amigliaccio@bloomberg.net;

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net