Italy Confirms Snam Split from Eni

The Italian government has confirmed that it will force energy company Eni to sell off its stake in gas distributor Snam Rete Gas, the Italian Minister for Infrastructure and Economic Development Corrado Passera has said.

Currently Eni holds a 50 per cent stake in Snam. It is hoped that the separation of the assets will encourage investor activity in Italy's gas market.

"We think that well-carried out and well-thought separation between infrastructure and sector operators could inject new investments and lead to lower costs for the country," Minister Passera told a press conference in Rome on Friday.

He also confirmed that the separation would apply to the whole company of Snam, and not just its gas transmission unit.

Yesterday, Chief Executive of Snam Carlo Malacarne said the decision would not impact upon the company's financing capabilities or hinder its plans to become a European gas transport network.

"Any (ownership) separation from Eni would not cause us any significant additional cost for financing," he told Reuters news organisation.

"Decisions on the capital structure of Snam today are decisions taken by Snam. We currently go to the market through Eni, but the cost of debt is in line with our shadow rating."