Italy To Shut Down Mammoth Public Holding Company

Private industry is taking over in Italy as the government shuts down its giant state holding company, Istituto per la Ricostruzione Industriale (IRI). Seventy years ago, in its heyday just after its creation by dictator Benito Mussolini, IRI controlled half of the country's manufacturing enterprises. Over the past decade IRI has been under pressure from the 15-nation European Union to sell off its market-dominating stakes in telecommunications, banking, and transportation to create a more competitive playing field. Most of these holdings have already been sold. Announcing that IRI will shut down Jun. 30, its chairman Piero Gnudi said: "Once IRI replaced the market. Now it leaves the stage, giving back to the market what the market owns." Finally awaited disposals include Rome's airports, and a 53% stake of Finmeccanica, the defense and industrial conglomerate, that still remains in state hands. This last deal alone will raise $7.5 billion. However flagship airline, Alitalia, in which the state still has a majority stake, cannot be privatized until problems in operating Milan's inefficient Malpensa airport are solved. RAI, the state television and radio service, is also considered too politically sensitive to pass into private hands.