Italy is set to retain a 51% share in the country’s postal service provider, Poste Italiane, according to the Treasury on Thursday, scaling back plans to cut the stake to a low of 35% from the current 64%.
The decision underscores the government's challenges in fulfilling its commitment to utilise asset sales to curb Italy's substantial public debt.
Back in January, Prime Minister Giorgia Meloni unveiled a decree allowing the Treasury to divest all or a portion of its 29.3% stake in Poste while maintaining control through another 35% stake held by state lender Cassa Depositi e Prestiti (CDP).
Following widespread criticism for proposing to sell a portion of a vital public service, Italy now intends to reassess the decree to reduce the stake in Poste, the Treasury announced during a meeting with trade unions, Reuters reports.
“We have been assured that the state will never go below 51%,” stated trade union Cisl representative Raffaele Roscigno.
The downsized sale comes within Rome's initiative to generate around 0.7% of GDP from asset sales between 2025 and 2027, aiming to alleviate one of the world's highest public debts in relation to domestic output.
The second highest in the eurozone after Greece, Italy’s debt is forecast to hit close to 140% of output until 2026 before a slight decline the following year.
Roscigno stated that the final decree is anticipated to be adopted within the next three weeks. He added that it would offer incentives to encourage Poste employees to purchase the company's shares, thereby maintaining a diverse shareholder base.
In 2015, Italy raised €3.1 billion by selling a 35% Poste stake in an initial public offering, valuing the group at €8.8 billion. The postal service provider is now worth €16.5 billion, the Reuters report adds.
However, trade unions are cautious following the announcement by the Treasury, with the CGIL trade union urging the government to ditch any divestment plans.
“Sale would be a very bad deal for the country,” according to Fabrizio Solari from CGIL.