Lagfin Nears Tax Settlement, Bringing Relief to Campari

(Alliance News) - Luxembourg-based holding company Lagfin, which controls 51.8% of Campari, is in negotiations with Italy's Revenue Agency for a settlement worth around EUR400 million to resolve a tax dispute over alleged evasion raised by the Monza prosecutor's office, Corriere della Sera reported on Thursday.

The agreement is reportedly at an advanced stage. At the end of October, magistrates accused the Garavoglia family's company of failing to pay the exit tax during the absorption of its Italian subsidiary, a transaction that allegedly generated capital gains of EUR5.3 billion.

The investigation, which has focused on Lagfin rather than Campari, led to the preventive seizure of EUR1.3 billion in Campari shares--equivalent to 16% of the company's capital. The alleged offenses include fraudulent declaration using other artifices and administrative liability of legal entities. Lagfin has reiterated that it has always complied with regulations.

The news, first reported by Bloomberg, provided a boost for Campari on the stock market: shares rose by 0.49% above EUR5.72, recovering losses accumulated since late October. The payment structure has yet to be finalized: according to Reuters, Lagfin may pay an initial tranche of EUR150 million by the end of 2025, with the remainder due from 2027. Equita believes the holding has sufficient liquidity to meet the first payment.

If confirmed, Corriere explains, the deal would reduce the short-term risk of a sale of Campari shares to finance the outlay. According to Equita, Lagfin could also manage subsequent payments thanks to expected dividends from Campari and the headroom for new debt allowed by bond covenants, noting that the holding currently has a EUR536 million convertible bond in Campari shares, with EUR429 million outstanding and maturing in June 2028.

Analysts nonetheless view the news as positive for Campari, as it removes a potential risk, though they note that the market had already anticipated a settlement for less than the initial seizure amount and saw little likelihood of a significant share placement in the short term.

By Antonio Di Giorgio, Alliance News reporter

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