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Money News

Former Atlantia CEO put under house arrest in bridge probe - sources

MILAN/GENOA (Reuters) - The former head of Italian infrastructure group Atlantia, Giovanni Castellucci, has been placed under house arrest by judges investigating the deadly 2018 collapse of a bridge in Genoa.

FILE PHOTO: Autostrade per l'Italia Chief Executive Giovanni Castellucci gestures during a news conference about the collapsed Morandi Bridge in Genoa, Italy August 18, 2018. REUTERS/Massimo Pinca/File Photo

Lawyers for Castellucci, who also previously served as CEO of Atlantia’s motorway unit, Autostrade per l’Italia, issued a statement expressing “shock and concern” over what they said was an unjustified measure that was not directly related to the bridge disaster in which 43 people died.

The move comes at a delicate moment for the group, controlled by the powerful Benetton family, which is in talks with a consortium led by Italy’s state-backed investor Cassa Depositi e Prestiti (CDP) over the sale of its 88% stake in Autostrade.

The future of Atlantia and one of its main operating units has been in doubt since the Morandi bridge disaster, which also sparked a political storm around Autostrade and the state of the motorway network it ran.

In the arrest warrant, judges wrote that wiretapped conversations showed Autostrade had been able to pay out high dividends based on profits boosted by “the systematic reduction of maintenance on the motorway network”.

Autostrade was not immediately available to respond but has repeatedly said that its maintenance expenses have never been lower than required under the terms of the motorway concession.

The current investigation, one of four separate but related cases set off by the incident, is focused on anti-noise barriers along motorways run by Autostrade.

Police allege that Autostrade failed to replace the barriers after discovering they were at risk of collapsing in strong winds, instead lowering them improperly to reduce their surface area.

Autostrade said in a statement that the barriers are present only on 60 out of a total of 3,000 km of the network and had been checked and were now safe. It added that its board had approved a 170 million euro plan to remove all the barriers in coming months.

The development in one of the probes linked to the bridge disaster could increase the pressure on Atlantia to hand over Autostrade to the CDP-led consortium, cutting short tough negotiations over the valuation of the asset.

At 1500 GMT Atlantia shares were down 3.7%, after trading was briefly halted earlier in the day following a 5%-drop.

HOUSE ARREST

In a statement on Wednesday, the police said three former and three current managers at Autostrade had been targeted in the investigation. Without identifying those involved, police said three people were under house arrest and three hit with “prohibitory measures” for allegedly failing to guarantee transport safety and for alleged fraud in public supplies.

Around 150 people including current and former Autostrade employees and transport ministry officials are under investigation in the main probe into the bridge collapse and three related investigations.

The group and its managers have always denied any wrongdoing over the bridge collapse.

Additional reporting by Domenico Lusi; writing by Giulia Segreti and Francesca Landini; Editing by Crispian Balmer, Kirsten Donovan

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