Berlusconi steps back into arena

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FLORENCE, Italy -- Italy's Silvio Berlusconi says he will go back to being a full-time politician -- and just a part-time media tycoon -- in the wake of his decision to found a new political party.

The three-time Prime Minister is the largest shareholder for Italian television and cinema giant Mediaset.

Less than 18 months after being narrowly voted out of office, Berlusconi announced he would dissolve the Forza Italia (Let's Go Italy) party he created in 1993 in favor of a new umbrella party called the Partito del Popolo Italiano (The Party of the Italian People). Berlusconi said the new party would will opposition groups and help unseat Prime Minister Romano Prodi, Berlusconi's chief rival in elections next year.

The party was officially launched Monday, and immediately attracted criticism from Berlusconi's former allies, most of whom rejected calls to join the new organization.

"I have yet to understand whether this is a new party or a rebranding of Forza Italia, but, either way, we are not interested," said Gianfranco Fini, the leader for the right-wing party Allianza Nazionale (National Alliance), which would become the largest opposition party if Forza Italia ceased to exist.

Leaders of other opposition parties said that Berlusconi's time as leader of opposition had passed and that it was time for someone else to lead Italy's political right.

But in announcing the details of the new organization Monday, Berlusconi was undeterred, predicting that the new party could galvanize anti-Prodi sentiment in time for next year's elections. Though Prodi's approval levels are low, his fortunes received a boost last week when the upper house of parliament approved his budget proposal despite strong opposition from Berlusconi and his allies.

Mediaset, meanwhile, will be run to a greater degree by Berlusconi's son, Pier Silvio, who has officially been at the company's helm for nearly two years -- albeit with frequent guidance from his father.

Investors reacted negatively to the news Monday, sending Mediaset shares nearly 3% lower to close at 6.65 euros ($9.71) in heavy trading. The shares have lost nearly a third of their value so far this year.
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