{"id":124622,"date":"2026-01-05T11:45:07","date_gmt":"2026-01-05T11:45:07","guid":{"rendered":"https:\/\/my.legal500.com\/guides\/?post_type=comparative_guide&#038;p=124622"},"modified":"2026-01-05T11:45:07","modified_gmt":"2026-01-05T11:45:07","slug":"italy-private-equity","status":"publish","type":"comparative_guide","link":"https:\/\/my.legal500.com\/guides\/chapter\/italy-private-equity\/","title":{"rendered":"Italy: Private Equity"},"content":{"rendered":"","protected":false},"template":"","class_list":["post-124622","comparative_guide","type-comparative_guide","status-publish","hentry","guides-private-equity","jurisdictions-italy"],"acf":[],"appp":{"post_list":{"below_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">bureau Plattner<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2024\/03\/bureau-Plattner-firm-logo.png\"\/><\/span><\/div>"},"post_detail":{"above_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">bureau Plattner<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2024\/03\/bureau-Plattner-firm-logo.png\"\/><\/span><\/div>","below_title":"<span class=\"guide-intro\">This country specific Q&amp;A provides an overview of Private Equity laws and regulations applicable in Italy<\/span><div class=\"guide-content\"><div class=\"filter\">\r\n\r\n\t\t\t\t<input type=\"text\" placeholder=\"Search questions and answers...\" class=\"filter-container__search-field\">\r\n\t\t\t<\/div>\r\n\r\n\t\t\t\r\n\r\n\r\n\t\t\t<ol class=\"custom-counter\">\r\n\r\n\t\t\t\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What proportion of transactions have involved a financial sponsor as a buyer or seller in the jurisdiction over the last 24 months?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In Italy, financial sponsors remain active across mid-market and upper-mid-market deals. According to AIFI annual reports, private equity and venture capital funds typically account for 25\u201335% of total M&amp;A deal volume, with the proportion noticeably higher in transactions above \u20ac100m. Sponsor-backed exits also represent a significant percentage of trade sales.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the main differences in M&A transaction terms between acquiring a business from a trade seller and financial sponsor backed company in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p><strong>Sponsor-backed sellers usually propose:<\/strong><\/p>\n<ul>\n<li>Locked-box pricing, rarely closing accounts.<\/li>\n<li>Limited business warranties, typically fundamental warranties only.<\/li>\n<li>W&amp;I insurance, shifting residual risk.<\/li>\n<li>Clean exit structures: reduced escrows\/retentions and cap limitations.<\/li>\n<\/ul>\n<p><strong>Trade sellers frequently accept:<\/strong><\/p>\n<ul>\n<li>Broader warranty packages, including operational warranties.<\/li>\n<li>Escrows\/indemnity holds.<\/li>\n<li>More willingness to provide post-closing covenants or transitional support.<\/li>\n<\/ul>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">On an acquisition of shares, what is the process for effecting the transfer of the shares and are transfer taxes payable?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>For Italian companies:<\/p>\n<ul>\n<li>Transfer of shares occurs by execution of a notarial share purchase agreement or endorsement of the share certificates and registration in the shareholders\u2019 register (S.p.A.) or execution of a notarial share purchase agreement subsequent Companies\u2019 Register filing (S.r.l.).<\/li>\n<li>Italian financial transaction tax (FTT) may apply where the transferred instruments fall within the FTT scope (S.p.A. only); the applicable rate depends on the trading venue\/structure of the transfer, 0.2% for the untraded stocks and 0.1% for traded stocks.<\/li>\n<li>A \u20ac200 fixed registration tax for notarial filings related to S.r.l. share transfers.<\/li>\n<li>Capital gains taxation depends on the seller\u2019s status and the availability of exemptions or treaty relief (including participation exemption for qualifying corporate sellers). The ordinary rate is 24% which may be reduced to 1.2% in case the participation exemption regime applies.<\/li>\n<\/ul>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How do financial sponsors provide comfort to sellers where the purchasing entity is a special purpose vehicle?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Common methods include:<\/p>\n<p>\u2022 Equity commitment letters from the fund.<br \/>\n\u2022 Guarantees from the fund or top-co.<br \/>\n\u2022 Reverse break fees payable if financing fails.<br \/>\n\u2022 Proof of funds and lender commitment papers.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How prevalent is the use of locked box pricing mechanisms in your jurisdiction and in what circumstances are these ordinarily seen?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Locked-box pricing is commonly used in Italy, particularly in competitive processes and sponsor-backed transactions. It is most often adopted where the target has stable cash generation and reliable historical financials. Completion accounts remain common where cash\/debt\/working capital are volatile, or in distressed\/special situations.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the typical methods and constructs of how risk is allocated between a buyer and seller?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Risk allocation is typically addressed through a combination of:<\/p>\n<p>\u2022 W&amp;I insurance (commonly used in sponsor-backed deals and increasingly in the upper mid-market).<br \/>\n\u2022 Seller liability focused on fundamental warranties (and often title\/capacity), with business warranties largely shifted to the insurer where W&amp;I is in place.<br \/>\n\u2022 Carefully negotiated disclosure processes, including tailored disclosure schedules and, where relevant, knowledge\/materiality qualifiers and (where negotiated) materiality scrapes.<br \/>\n\u2022 Interim covenants governing the conduct of business between signing and closing, particularly where regulatory clearances are pending.<br \/>\n\u2022 MAC clauses are typically difficult to negotiate as a standalone walk-away right in Italy and are often heavily qualified.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How prevalent is the use of W&I insurance in your transactions?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>W&amp;I insurance is commonly used in Italy in sponsor-backed transactions and larger\/upper mid-market deals, often to facilitate a clean exit. Its use is also increasingly seen in mid-market transactions where a competitive auction process and limited seller liability are key drivers. Insurers may offer synthetic warranty solutions, depending on the deal profile and underwriting appetite.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How active have financial sponsors been in acquiring publicly listed companies?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Activity is selective but increasing, particularly in infrastructure, energy transition, and mid-cap listed industrial companies. Take-privates require compliance with CONSOB tender offer rules and often sophisticated club-deal structures.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Outside of anti-trust and heavily regulated sectors, are there any foreign investment controls or other governmental consents which are typically required to be made by financial sponsors?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Italy\u2019s FDI regime (so called \u201cGolden Power\u201d) can require filings in a range of strategic sectors (including energy, telecoms, defence, transport and certain technology-related areas). In-scope acquisitions are typically managed through a dedicated regulatory workstream (filing, timetable management and, where applicable, conditions\/mitigations). Outside these areas, additional governmental consents are less frequently required, subject to sector-specific regulation.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How is the risk of merger clearance normally dealt with where a financial sponsor is the acquirer?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Typically addressed via:<\/p>\n<p>\u2022 Hell-or-high-water clauses (for must-clear deals or strong sponsor bidders).<br \/>\n\u2022 Efforts-based covenants (reasonable or best efforts).<br \/>\n\u2022 Long-stop date with termination rights.<br \/>\n\u2022 Sometimes a reverse break fee if clearance fails.<\/p>\n<p>Sponsors usually prefer reasonable best efforts, resisting extensive divestiture obligations.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Have you seen an increase in (A) the number of minority investments undertaken by financial sponsors and are they typically structured as equity investments with certain minority protections or as debt-like investments with rights to participate in the equity upside; and (B) \u2018continuation fund\u2019 transactions where a financial sponsor divests one or more portfolio companies to funds managed by the same sponsor?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p><strong>A) Minority Investments<\/strong><\/p>\n<p>Increasing significantly in Italy. Structures include:<\/p>\n<ul>\n<li>Equity with governance rights (board seat, veto rights on reserved matters, information rights).<\/li>\n<li>Structured preferred equity or mezzanine with equity kickers, used especially in growth and infrastructure transactions.<\/li>\n<\/ul>\n<p><strong>(B) Continuation Funds<\/strong><\/p>\n<p>Rapidly increasing, especially for high-performing assets requiring additional hold periods. Italian LPs have become more comfortable with LPAC approvals, fairness opinions, and third-party validation processes.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How are management incentive schemes typically structured?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Common Italian structures:<\/p>\n<p>\u2022 Sweet equity: management subscribes to a class of shares with higher participation in upside.<br \/>\n\u2022 Option plans or virtual stock options.<br \/>\n\u2022 Ratchet mechanisms tied to fund IRR or MOIC.<br \/>\n\u2022 Co-investment schemes, especially for senior management.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any specific tax rules which commonly feature in the structuring of management's incentive schemes?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Key considerations typically include:<\/p>\n<p>\u2022 Sweet equity proceeds may be treated as capital gains where structured at fair market value and supported by robust documentation and valuation, and where the overall design supports an investment (rather than employment-related) return.<\/p>\n<p>\u2022 Option plans may be taxed as employment income, depending on plan design and the individual\u2019s status.<\/p>\n<p>The Italian carried interest regime may apply where statutory conditions are met (including a meaningful investment at risk, subordination to investors, and a minimum holding period), subject to careful structuring and documentation.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are senior managers subject to non-competes and if so what is the general duration?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, typically included.<\/p>\n<p>\u2022 Usual duration: 12\u201336 months post-exit.<br \/>\n\u2022 Must be adequately compensated under Italian law (Civil Code Art. 2125).<br \/>\n\u2022 Scope must be proportionate (territory + activities).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How does a financial sponsor typically ensure it has control over material business decisions made by the portfolio company and what are the typical documents used to regulate the governance of the portfolio company?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Control is exercised through:<\/p>\n<p>\u2022 Shareholders\u2019 agreements outlining reserved matters (budget, business plan, capex, acquisitions, disposals, financing, hiring of key executives).<br \/>\n\u2022 Board appointment rights and veto rights.<br \/>\n\u2022 By-laws mirroring governance arrangements.<br \/>\n\u2022 Information rights and reporting obligations.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is it common to use management pooling vehicles where there are a large number of employee shareholders?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Common when many managers participate.<\/p>\n<p>Vehicles used:<\/p>\n<p>\u2022 Italian investment vehicles.<br \/>\n\u2022 Foreign pooling vehicles, depending on tax\/regulatory analysis.<br \/>\nAdvantages include simplified cap table management and unified governance.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the most commonly used debt finance capital structures across small, medium and large financings?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p><strong>\u2022 Small cap:<\/strong> bilateral bank loans, minibonds, and Italian bank club deals.<br \/>\n<strong>\u2022 Mid-cap:<\/strong> senior secured bank debt, unitranche facilities from private credit funds.<br \/>\n<strong>\u2022 Large cap:<\/strong> syndicated LMA-style senior loans, TLB, bridge-to-bond structures, and high-yield bonds.<\/p>\n<p>Private credit adoption has grown significantly as banks tighten underwriting.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is financial assistance legislation applicable to debt financing arrangements? If so, how is that normally dealt with?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, Italian law prohibits financial assistance by target companies, such as granting loans, guarantees, or any financial support for the purchase or subscription of their own shares or quotas. The prohibition can be overcome by S.p.A. companies through a strict procedure:<\/p>\n<ul>\n<li>board report,<\/li>\n<li>shareholders\u2019 meeting approval,<\/li>\n<li>use of distributable reserves.<\/li>\n<\/ul>\n<p>The prohibition is strict for S.r.l. companies.<br \/>\nAs a consequence, acquisition financing may be structured at the holding level (often, a SPV) with a subsequent reverse merger.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">For a typical financing, is there a standard form of credit agreement used which is then negotiated and typically how material is the level of negotiation?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Italian financings typically use LMA-based templates for syndicated or sponsor deals.<\/p>\n<p>Negotiation is material, especially around:<\/p>\n<p>\u2022 financial covenants,<br \/>\n\u2022 EBITDA definitions,<br \/>\n\u2022 equity cure mechanics,<br \/>\n\u2022 permitted acquisitions\/disposals,<br \/>\n\u2022 intercreditor terms.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What have been the key areas of negotiation between borrowers and lenders in the last two years?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>\u2022 Covenant looseness vs. tighter lender requirements.<br \/>\n\u2022 Margin ratchets tied to leverage.<br \/>\n\u2022 Incremental\/debt basket flexibility.<br \/>\n\u2022 ESG-linked margin adjustments.<br \/>\n\u2022 Refinancing protections for lenders.<br \/>\n\u2022 Unitranche vs. senior-mezz structures regulation.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Have you seen an increase or use of private equity credit funds as sources of debt capital?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes\u2014significantly.<\/p>\n<p>Private equity funds increasingly rely on private debt funds for:<\/p>\n<p>\u2022 unitranche financing,<br \/>\n\u2022 PIK instruments,<br \/>\n\u2022 NAV-based or hybrid facilities,<br \/>\n\u2022 bespoke structures unavailable from<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\r\n<div class=\"word-count-hidden\" style=\"display:none;\">Estimated word count: <span class=\"word-count\">1696<\/span><\/div>\r\n\r\n\t\t\t<\/ol>\r\n\r\n<script type=\"text\/javascript\" src=\"\/wp-content\/themes\/twentyseventeen\/src\/jquery\/components\/filter-guides.js\" async><\/script><\/div>"}},"_links":{"self":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide\/124622","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide"}],"about":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/types\/comparative_guide"}],"wp:attachment":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/media?parent=124622"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}