Ops normal, Cecchi Gori tells public
EmptyROME --Italy's Cecchi Gori Group said on Wednesday, just a day after the holding company controlling the media group was declared bankrupt, that its operations will continue normally.
The company issued a statement saying that, while the financial problems with holding company Finmavi SpA were real, they had no connection with day-to-day operations.
"Following the press reports regarding Finmavi, we feel it necessary to clarify that our company Cecchi Gori Editoria Elettronica is not at all involved," the statement said. "We also want to stress that Cecchi Gori Home Video has been and continues to be involved in multibrand distribution."
The two Cecchi Gori subsidiaries named in the release control most of the aspects of the group's operations that are actually seen by the public. Finmavi, on the other hand, is a holding company that is the group's major shareholder.
But while the company insisted that the troubles at Finmavi did not necessarily mean problems for the rest of the group, financial sector analysts said that could not remain the case for long.
"I have no inside knowledge about the operations at Cecchi Gori, but it is difficult to believe that the bankruptcy of a company's major shareholder would not effect the company in many ways," Javier Noriega, chief economist with investment bankers Hildebrandt and Ferrar, said in an interview.
Cecchi Gori officials declined to elaborate on that statement.
On Tuesday, Cecchi Gori Group chairman Vittorio Cecchi Gori vowed to fight the bankruptcy decision and renewed his promise to help rebuild the fortunes of the company (HR 10/25).
"I will fight with all my strength to expose the injustices I have been submitted to in these last years," Cecchi Gori said. "I may even die poor, but at least it will be as an honest and respectable person."
For years, the Cecchi Gori Group was one of the dominant players in the Italian media and entertainment sector, with stakes in the television, film production and distribution, and exhibition sectors. It produced a dozen films per year, including such critically acclaimed blockbusters as 1994's "Il Postino" and "Life is Beautiful," which took home the foreign-language Oscar in 1999.
But the company's fortunes began to slide after its Telemontecarlo network locked horns with state broadcaster RAI and Mediaset, the media giant controlled by former Italian Premier Silvio Berlusconi. Telemontecarlo never gained traction and in 2000 it was unloaded at a loss to former Italian telecommunications monopoly Telecom Italia, which rebranded the network La 7.