Italy's government is embarking on its biggest-ever privatisation programme, with state-owned jewels from electricity to TV to the post office potentially up for grabs, in a bid to slash the world's third-largest debt.
The Treasury started the sell-off race on Wednesday, when it announced it would sell up to 20 per cent of dominant utility Enel to Italian and international investors. A financial source said it aims to raise up to €6 billion ($7.24 billion) with the deal.
But that is just a nibble from Italy's debt pile, which at the end of last year was equal to 106.2 per cent of annual gross domestic product.
To chop it below 100 per cent, the government aims to raise €120 billion ($145 billion) from the privatisation programme by 2008.
"We are selecting the menu," Prime Minister Silvio Berlusconi said this week.
With the utility, 51 per cent Treasury-owned, offered as an appetiser, the focus is on what will be served up next.
The state controls Poste Italiane, broadcaster RAI and electricity grid GRTN.
It has 70 per cent of financing firm Cassa Depositi e Prestiti, 62 per cent of flag carrier Alitalia, 35 per cent of oil major ENI and 32 per cent of defence firm Finmeccanica.
A study by consultants KMPG valued state assets, including property, at €1.77 trillion, Italian media reported today. But only a part of the government's announced fund-raising scheme will involve the sale of state firms.
A chunk of the proceeds will come from complex market operations and the shuffling of assets between state agencies.
"Privatisations of €100 billion over a 4-year span may look ambitious, but clearly this is a much broader approach, which could include securitisation of credit and real estate assets as well," Morgan Stanley economist Vincenzo Guzzo said.