Italy’s Rai completes successful Rai Way IPO

Italian public broadcaster Rai’s transmission tower subsidiary Rai Way has successfully completed its IPO, with its share price rising significantly after the company began trading.

Rai Way set its IPO price last week at €2.95 (US$3.67), at the bottom of its initial price range, valuing the company at €802 million. The company said at the time that its order book was oversubscribed by a factor of 2.1.

Rai Way’s shares rose by about 5% on early trading before falling back slightly on news of an unsuccessful legal suit against the Italian government’s decision to levy €150 million against licence fee income, which provoked a split in Rai’s board and the resignation of one of its members, entrepreneur Luisa Todini.

In an interview with business daily Il Sole 24 Ore, Rai director-general Luigi Gubitosi said the appeal decision “certainly does not send a good signal to the market” but said that Rai Way would succeed in any case because it is a well-managed operation with good growth prospects.

Gubitosi said that the privatisation of Rai itself, which has been discussed in the past, was a matter for the government but that he did not think it would happen during his term in office, which is due to expire next year.

Rai Way’s successful IPO, which was executed within five months comes despite unfavourable economic news from Italy, with other companies pulling their listing plans in recent months.