Press release

IFIL - Press release In accordance with art. 114, paragraph 5 of D.Lgs. 58/1998September 17, 2005

In compliance with the request by CONSOB below are further details regarding the
September, 15th announcement of the purchase of 82,250,000 Fiat ordinary shares:
• EXOR Group S.A. is a Luxembourg holding company controlled by Giovanni Agnelli
e C. The latter controls EXOR through a 70.45% direct stake and 29.30%
indirect stake through IFI S.p.A.. IFI ordinary capital is fully owned by Giovanni
Agnelli e C. IFI S.p.A. hold 63.6% of IFIL Investments S.p.A. ordinary
• IFIL S.p.A. rationale for the transaction can be summarized as follows:
maintaining its stake above 30% of ordinary capital at a favourable price compared to
current market prices as well as to the price of the capital increase (approved by Fiat on
September, 15th 2005) with pre-emption rights to existing shareholders pursuant the
conversion of the Mandatory Convertible Facility. The transaction represents a unique
and timely opportunity to maintain its level of ownership and to participate fully in the
expected progress of the Fiat Group thanks to the increased visibility on the
implementation of the turnaround currently underway.
IFIL considers this investment to have a beneficial risk reward profile.
Furthermore, IFIL Investment S.p.A., by acting on the repeatedly communicated intention to
remain the reference shareholder of Fiat, believed it important to avoid the dilution due to the
Mandatory Convertible Facility considering: (i) the progress underway at Fiat and its potential
for value creation; (ii) the potential destabilization of Fiat management without a reference
shareholder; (iii) the consequent possible decrease in value of the company and hence of the
value of IFIL’s investment.
The transaction is in line with the active management role of the stake in Fiat stated in IFIL’s
2003 regrouping and streamlining. This investment offers significant potential for value
increase reflected in the appreciation of IFIL’s NAV (Net Asset Value). In particular, Fiat
offers: (i) net debt reduction from recently closed extraordinary transactions (GM, Italenergia,
Convertendo); (ii) operating improvement (doubling of industrial trading profit at the end of
June) as compared to the preceding year; (iii) technological excellence; (iv) strengthening of
Fiat Auto’s competitive position (positive acceptance of new products and identification of
new industrial partners); (v) partial underestimation of CNH and Iveco potential (prospective
recovery of profitability and cash flow generation, strong competitive geographical and
technological positioning).
At the same time, confirming our underlying strategy, IFIL will continue to seek new
investments, based on the considerable liquidity that the company will have after the
transaction (€ 350 million approx.), the particular type of investment that Sanpaolo IMI
represents (€ 1,200 million approx.) and the proceeds that will be available in Sequana Capital
after the disposal of Permal.
• The price of € 6.5 for each Fiat ordinary share agreed in the Sale & Purchase
Agreement for n. 82,250,000 Fiat ordinary shares between EXOR Group and IFIL
Investments S.p.A. is the result of the negotiation between EXOR Group and IFIL
Investment S.p.A.. The agreement takes into consideration the size of the block
(which would have made the sale on the open market potentially lengthy and the
price uncertain), the weighted average official prices of the past 3 and 6 months,
respectively € 6.9 and € 6.1 per share, and also the consensus Fiat target prices
published by the main financial analysts. Such price has been considered fair by the
Board of Directors of IFIL S.p.A.
• On September 8th, 2005, IFIL Investments S.p.A. mandated Mr. Gerardo Bragiotti of
G.B. Partners to advise on the transaction. Mr. Bragiotti also provided a “fairness
opinion”, submitted to the Board of Directors of IFIL Investment S.p.A. on
September 15th, confirming the adequacy of the terms of the transaction and of the
price of €6.5 per Fiat ordinary share.
• In summary, the transaction has the following economic and financial effects for IFIL
Investments S.p.A.:
(i) Economic effects: a higher participation in Fiat’s expected
results corresponding to the avoidance of dilution from the Fiat
capital increase; the absence of financial positive interest on the
cash invested has no significant impact;
Tel. 011.5090.320 Tel. 011.5090.360
e-mail: e-mail:
(ii) Financial effects: considering the current price of Fiat shares the
transaction implies an increase in IFIL NAV of approx
€ 100 million. The Net Financial Position will decrease to € 349
million (from € 884 million) following the cash out flow of
€ 535 million for the purchase of the Fiat shares.
• No modification in the compensation of Members of the Board of Directors of IFIL
and/or of its subsidiaries is envisaged in connection with the transaction. 

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