Saipem to Stand Trial On Corruption Charges in Algeria

While Italy's Saipem is working on a restructuring plan to raise more than 3 billion euros ($3.4 billion), a Milan judge ruled that the oil and gas service company should stand trial on charges it bribed official in Algeria to win contracts. 

‘Saipem informs that the Judge of the Preliminary Hearing in Milan today upheld the application submitted in February 2015 by the Milan Public Prosecutor’s office for committal for trial against, among others, Saipem SpA and a number of former employees of the company, for acts of corruption alleged to have taken place in Algeria up until the beginning of 2010’ reads a note released by Saipem. 

Reuters wrote that a Milan preliminary hearings judge acquitted former ENI’s CEO Paolo Scaroni and ENI, while sending to trial three former top executives at Saipem and two Algerian intermediaries in connection with the alleged corruption of Algerian officials. Their trial should start in December before Milan judges.  

In the meantime, Saipem, which has debts for 5.5 billion euros, is continuing talks for its cap hike and a deal with Italian state lender Cassa Depositi e Prestiti (CDP).  

A second article by Reuters said on Friday that Saipem is finalising a banking consortium, with Goldman Sachs and JPMorgan as coordinators. The banks involved in the consortium should be Citi, Deutsche Bank, Mediobanca, Intesa Sanpaolo and UniCredit. According to Reuters’ sources, a final decision should be announced by mid-October.  

By then, the parties should disclose the strategic plan, and the possible sale of a stake in Saipem from ENI to CDP. 

In August, Eni denied speculations of being close to splitting its stake in Saipem. The six-legged dog holds a 43% interest in Saipem.

Saipem’s shares jumped on the news, up more than 6% in the Friday’s session.