Arpe gatecrashes Unipol's Premafin plan A private equity fund run by Matteo Arpe, the former chief executive of Capitalia, and Palladio Finanziaria have offered to invest as much as €450m in the Italian insurance holding company PremafinFinanziaria, gatecrashing a merger plan by insurance rival Unipol. The move ratchets up an increasingly contentious tie-up plan involving Fondiaria-SAI and its parent company Premafin with Unipol, as the initial deal has already raised concerns with regulators about the impact on minority investors. Sator, Mr Arpe's fund, and Palladio in a statement said: "Our offer is better than the agreement announced with Unipol" because it excludes a merger between Fondiaria and Premafin and is fairer for minority shareholders. Their offer, which expires on March 8, would see Sator and Palladio making their investment through a capital increase with the aim of taking control of 60 per cent of the group. It is conditional upon Premafin shareholders rejecting a proposed merger with Unipol and on an agreement with bank creditors on Premafin's debt. Unipol, Italy's third-largest insurer by premiums, agreed last month to buy new shares in Premafin to allow it to participate in a €1.1bn share sale announced by Fondiaria-SAI. After the recapitalisation, Unipol, Premafin, Fondiaria and its MilanoAssicurazioni unit plan to merge. The initial proposal has raised attention in Milan and among analysts as it is being organised by Mediobanca, the Milanese investment bank, which also has €1.1bn in subordinated loan exposure to Premafin. Cheuvreux analysts said they did not expect the counter offer from Mr Arpe to be successful as the insurance regulator normally prefers an industrial partner, and there was no upside for minority shareholders compared with Unipol's offer. They expect Axa or other foreign insurers will "adopt a cherry picking strategy, waiting for the likely disposal of non-life assets after the merger with Unipol to comply with antitrust constraints. The Palladio/Sator proposal seems to have been finalised more with a view to becoming a player in this break-up scenario.