Mediaset Shares Surge on Delays in Parliamentary Debate on Berlusconi's Future
The shares rose more than 4 percent in heavy trading after the proceedings on Berlusconi hit a road block.
ROME – Shares in Mediaset, the media conglomerate controlled by billionaire tycoon Silvio Berlusconi shot higher in heavy trading Wednesday after lawmakers delayed a vote over Berlusconi’s political fate.
Parliament started debate Monday on whether to strip Berlusconi of his Senate seat in the wake of the Italian Supreme Court’s August 1 ruling that upheld a lower court’s conviction of Berlusconi on false accounting and tax fraud in connection with Mediaset acquisition deals.
But Berlusconi’s allies in parliament threatened to pull their support for Prime Minister Enrico Letta. If they did, it would deprive Letta of his parliamentary majority and he would be forced to step down. Since Monday, blocs in parliament tried to negotiate a compromise that would have maintained the support for the government from Berlusconi’s coalition while allowing lawmakers to sanction the 76-year-old mogul in some way. But the efforts failed.
Debate is set to restart Thursday, but focusing on technical aspects of the situation. And it now appears a decision will take longer than the hours or days many predicted before debate started Monday.
The news was welcomed by investors, which bid up the price of Mediaset shares by more than 4 percent before the fell a little at the close to finish 3.3 percent higher on the day at €3.32 ($4.38). It was the biggest one-day jump for the shares in nearly a month.
Despite softening support in recent sessions, ahead of the parliamentary debate on Berlusconi, Mediaset shares have been among the biggest gainers on the Italian Stock Exchange so far this year, nearly tripling from their all-time low of €1.16 ($1.53) set in December.
Parliament’s debate on Berlusconi’s future is separate from that of the courts. After the Supreme Court ruling, Berlusconi is expected to serve a year of house arrest starting next month, while the lower court has been ordered to “reconsider” the ban on politics it originally ordered.