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Libya Buys UniCredit Stake Worth $1.5 billion

TRIPOLI — Libya’s central bank and two other investment groups from the country bought a stake in UniCredit SpA worth 1.1 billion euros ($1.5 billion), triggering a surge in the share price of Italy’s biggest bank.

The transaction will lift Libyan stake to 4.23 per cent, making the investors the second-largest shareholder in UniCredit. The Libyans also plan to buy as much as 500 million euros in additional shares in the bank’s planned capital increase, according to a statement from the Libyan government after markets closed yesterday. UniCredit rose as much as 12 per cent in early trading in Milan.

Prime Minister Silvio Berlusconi said October 15 that he was concerned that the plunge in share prices of Italy’s biggest companies would leave them vulnerable to hostile takeover by foreign investors. UniCredit shares have fallen 62 per cent this year and slipped to an 11-year low of 2.16 yesterday.

Libyan government-controlled investment vehicles have been active in Italy for years.

The Libyan Arab Investment Company SA is the second-largest shareholder of Turin’s Juventus Football Club SpA. The Libyan Foreign Bank initially invested in UniCredit in 1997, building a 0.56 per cent stake before the new purchase.