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Fiat Chrysler Automobiles NV and publisher Gruppo Editoriale L’Espresso SpA are combining editorial assets in a bid to create the “leading player” in the Italian publishing industry.
Fiat’s Itedi SpA unit signed a memorandum of understanding to merge with L’Espresso, publisher of daily newspaper la Repubblica and weekly magazine L’Espresso, the companies said in separate statements. Fiat owns Turin daily La Stampa, the No. 3 generalist daily in Italy.
The deal give the Agnellis’ editorial holdings more financial muscle by linking up with L’Espresso, Italy’s largest publicly-traded publisher by market value, six months after buying the biggest stake in the Economist magazine. Fiat Chairman John Elkann, a new-generation leader of the Agnelli family business, is forging the combination with the young head of another prominent Italian industrial family, Rodolfo De Benedetti, who heads CIR SpA.
"The Agnellis want a new industrial entity with some strong brands and a very good reputation," said Enrico Valdani, a professor of economics and business management at Milan’s Bocconi University. Combining with L’Espresso makes sense because it will allow for containment of costs and give access to more premium content, he said.
Under the proposal, Fiat would hold about 16 percent of the combined entity, while L’Espresso’s controlling investor CIR would own more than 40 percent. In addition, Fiat plans to distribute its 17 percent holding in rival publisher RCS MediaGroup SpA, owner of the top selling daily Corriere della Sera, to holders of its common stock.
The deal is “consistent with its desire to increase focus on its core business of making cars,” Fiat said in a stock-exchange statement on Wednesday.
La Repubblica and Corriere della Sera are Italy’s two biggest generalist daily newspapers.