After an Agnelli family meeting last weekend they have announced that they will pump in a further €250 million into the Fiat Group.

The Agnelli family holding company Ifil SpA has announced that it will not be paying a dividend after posting a €516.4million loss for 2002 after writing down the value of its holdings in the Fiat Group and its stake in Club Mediterranee. The Agnelli's investment companies are currently being overhauled with the stakes in Fiat, the Juventus Football Club and Sanpaolo Bank IMI being transferred from subsidary Ifi to the parent company. Meanwhile US fund K Capital Partners have raised their stake in Ifil from 2% to 5.3%.

The Board of Directors of Fiat met today under the chairmanship of Umberto Agnelli to examine and evaluate the binding offers presented for the purchase of one hundred per cent of Toro Assicurazioni. 

The Board decided to accept the binding offer presented by the De Agostini Group. 

The value of the transaction is 2.4 billion euros for the whole stock of the company, including all equity investments. 

Exclusive negotiations for the final agreement will begin in the next few days while the closing, subject to legal requirements, is scheduled to take place within the end of June.

Today’s transaction is part of the program implemented by the Group to reinforce its financial position.

The sale of Toro Assicurazioni will cut the Group’s net debt by about 1.4 billion euros and generate a capital gain of approximately 350 million euros.

Toro Assicurazioni is the third-largest Italian insurance group with over 3,000 employees. Active in all segments of the business in Italy and abroad, in 2002 it earned premiums for 5.2 billion euros and reported an operating income of 147 million euros.

In the past few days we said we would have accelerated the pace of scheduled divestitures. And in this way we are now proceeding. Ten days ago the sale of Fidis and today the Board of Directors resolved to sell Toro Assicurazioni for 2.4 billion euros.

I wish to personally thank the Toro management for the excellent work they performed within the Fiat Group, and I am sure they will continue to work with the same commitment within the De Agostini Group. 

The sale of Toro represents a great sacrifice for us. It is however necessary to cut our debt and back our development programs. Just like we stepped up the pace of divestitures we are now working even harder on our industrial processes with the aim of improving our operating profitability in the short and medium term and, consequently, our cash flow.

Thanks to today’s transaction, we are in compliance with the targets set with the lending banks, with which we are continuing to cooperate in a most profitable way.