Blackstone/Atlantia: the Benettons fashion keen deal with tragic echoes

Blackstone and the Benetton family are close to finalising the €50bn acquisition of Atlantia, the Italian transport infrastructure company. By some yardsticks this could be the largest buyout ever. It is undoubtedly a good deal for the Benetton family. The private equity group stands to make a healthy return too — provided the asset performs.

There is irony in all of this. Atlantia is best-known as the former manager of Genoa’s Morandi bridge, which partially collapsed in 2018 with the loss of 43 lives. The Benetton family controlled 33 per cent of the company and was among the targets for public anger following the tragedy.

Atlantia owns stakes that include Spanish toll road operator Abertis and airports in Rome and the Côte d’Azur. The Benetton stake has been worth around €4.5bn.

Following the buyout, the family will sit on a 57 per cent stake in the new, private Atlantia, valued at €6.3bn at the acquisition price. That is without spending additional money or ceding control.

The key to the €1.8bn valuation uplift is that the Benettons are selling their stake — but keeping it too.

The Italian family and Blackstone are buying Atlantia through a special purpose vehicle. The US alternatives giant has invested €4.4bn for 38 per cent of the SPV. The Benettons have proffered their shares in Atlantia at the bid price, incorporating a 40 per cent premium.

Once the deal completes and the SPV merges with Atlantia, the Benettons will have 57 per cent of a group with an equity value of around €11bn.

The Benettons are basically revaluing their shares, so the €1.8bn amounts to a paper profit. Whether it grows or shrinks will depend on how Atlantia fares financially.

The transaction is at a steep 12 times 2022 ebitda, on S&P Capital estimates. But Atlantia’s motorways and airports are largely regulated and inflation-linked. Indeed, 2025 ebitda is expected to rise 30 per cent compared with this year’s numbers, on Morgan Stanley estimates.

Blackstone clearly believes in the group’s prospects. If it makes target returns typical for an infrastructure fund — call them low double digits — the Benettons will be in for a rollicking ride.