Italy’s government expanded its powers to block foreign takeovers and prepared a massive injection of liquidity into companies that risk bankruptcy amid the world’s deadliest coronavirus outbreak.
The government will back loans to companies for a total of more than 750 billion euros ($809 billion), expanding previously agreed guarantees by 400 billion euros. No aid will be given to companies that pay out dividends.
“This is a huge sum, both for the internal market and for exports,” Conte said at a news conference in Rome.
The prime minister also said Italy’s so-called Golden Power rules against foreign takeovers will be significantly extended. Curbs will now cover a wider range of sectors, including banks, insurers, energy and healthcare, and will also be applicable to European Union companies. The rule will be applied also to non-European companies looking to take stakes over 10% and worth more than a million euros, the cabinet later clarified in a statement.
The decree also had measures to help schools managing the emergency, including hiring 4500 teachers. It also gives 450 million euros of additional funds to the emergency czar to take actions to contain the spread of the virus.
Italy’s GDP will fall 22% in the second quarter, as an intensification of the supply shock adds to demand shock that has mainly affected the services sectors, according to an April 2 report by UniCredit SpA.
Conte, whose administration approved an initial 25-billion-euro stimulus package last month, is working on new measures worth at least the same amount for later this month, which will include emergency income for people trapped in the underground economy.
(Update with details on anti-takeover powers, hiring of teachers)
To contact the editors responsible for this story:
Jerrold Colten, Marco Bertacche
© 2020 Bloomberg L.P. All rights reserved. Used with permission.