Milan joins list of London suitors

PARIS - Italy's stock market must find an international partner and would consider teaming up with European rivals as a wave of consolidation sweeps the sector, the chief executive of the Milan bourse said yesterday.

Massimo Capuano told France's La Tribune daily that it was essential for the Italian bourse to link with another player and said he was interested in gaining greater visibility in London, which hosts sizeable US and Asian transaction volumes.

"We absolutely must find an international partner," he said. "I have always said that for Italy, the most interesting financial market is London."

Speaking amid intense speculation about the future of the London Stock Exchange, which pan-European market operator Euronext has been courting for a year and which has just received a bid from Australia's Macquarie Bank, Capuano said he was not in contact with Macquarie.

But he said he would consider joining German operator Deutsche Boerse and Euronext if the two decided to join forces.

"Everything depends on the conditions," he said.

"If another combination was as attractive to international business, why not? But so far I only see such a capacity in London."

Capuano repeated that the Milan bourse hoped to achieve a stock market listing of its own during 2006 so as to enhance its financial clout.

"What we are lacking from a practical point of view is the statute of a company listed on the stock market," he said.

"That would give us greater resources to act," he added. "With the support of our shareholders, we could begin the process of admission to the stock market, if the law is approved before the end of 2005, and we could list in 2006."

The Italian bourse has been waiting for approval of the country's so-called savings bill, which revises market regulations and reforms the Bank of Italy, he said. Italy's lower house of parliament passed the bill last week.

Capuano said the resignation of central bank governor Antonio Fazio earlier in December had been a "delicate issue" in relationships with the stock market's foreign partners.

- REUTERS